How does Indiana Code 23-2-2-7-1(9) affect the non-competition covenants for Cool Binz franchisees after termination or expiration in Indiana?

According to Cool Binz's 2025 Franchise Disclosure Document, Indiana Code 23-2-2-7-1(9) impacts the non-competition covenants within the franchise agreement. Specifically, it prohibits Cool Binz from enforcing non-compete agreements that extend beyond any exclusive territory granted to the franchisee. This means that while Cool Binz can restrict a franchisee from competing within their designated territory after the franchise agreement terminates or expires, they cannot prevent the franchisee from competing outside of that territory.

This provision is outlined in the addendum to the Franchise Agreement for use in Indiana. The FDD states that the summary section of Item 17(r), which discusses non-competition covenants after the franchise terminates or expires, is amended to reflect this limitation. Therefore, the standard non-compete terms described in the Franchise Agreement and Item 12 of the FDD are subject to this Indiana law.

For a prospective Cool Binz franchisee in Indiana, this is a beneficial provision. It allows more freedom to operate a similar business outside of the exclusive territory should they choose to leave the Cool Binz system. It is important for potential franchisees to understand the exact boundaries of their exclusive territory as defined in the Franchise Agreement, as the non-compete restrictions will only apply within that specific area. Franchisees should consult with a legal professional to fully understand the implications of this law and how it affects their rights and obligations under the franchise agreement.