Is the non-interference provision in the Cool Binz Franchise Agreement subject to state law?
Cool_Binz Franchise · 2025 FDDAnswer from 2025 FDD Document
rate your COOL BINZ Business. | | q. | Non competition covenants during the term of the franchise | Section 6.A | During the Term, you, your Managing Owner and your Designated Manager, shall not: (i) engage in any capacity in any other business offering leasing or portable storage equipment (except for other franchises or authorizations we enter into with you); (ii) use our Confidential Information, System, intranet website, Manuals, Marks, customer lists, Customer Information, or any colorable imitations, in connection with any business other than the COOL BINZ Business; (iii) attempt to or divert any business or customer of the COOL BINZ Business to any competitor, or do any other act injurious or prejudicial to the goodwill of the Marks or the System. This provision is subject to state law. | | r. | Non competition covenants after the franchise is terminated or expires | Section 13.D | For 18 months from expiration or termination of the Franchise Agreement, you, your owners and, your Designated Manager, shall not (a) engage in any capacity in any business offering leasing or portable storage equipment or any services offered by our affiliates, (b) solicit business from customers of your former COOL BINZ Business, or (c) attempt to or divert any business or customer of the COOL BINZ Business or do any other act injurious to the goodwill of the Marks or the System or engage in any business relationship | | | Provisions | Section in Franchise Agreement | Summary | |----|-----------------------------------------|--------------------------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------| | | | | with any of your customers or former customers, within: (i) the Territory; (ii) the Territories of any COOL BINZ franchisees, COOL BINZ Company Store, or any other COOL BINZ business operator; or (iii) a radius of 50 miles from the Territory. This provision is subject to state law. | | s. | Modification of Agreement | Section 15.J | Modification of the Franchise Agreement must be in writing and agreed upon by both parties. | | t.
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 53–58)
What This Means (2025 FDD)
According to the 2025 Cool Binz Franchise Disclosure Document, the non-competition covenants during and after the term of the franchise agreement are subject to state law. Specifically, Section 6.A of the Franchise Agreement states that during the term, the franchisee, their Managing Owner, and Designated Manager cannot engage in any business offering leasing or portable storage equipment (except for other Cool Binz franchises), use Cool Binz's confidential information, or divert any business or customer of the Cool Binz Business to a competitor.
For 18 months after the expiration or termination of the Franchise Agreement, Section 13.D states that the franchisee, their owners, and Designated Manager cannot engage in any business offering leasing or portable storage equipment, solicit business from customers of their former Cool Binz Business, or divert any business or customer of the Cool Binz Business within the Territory, the Territories of other Cool Binz franchisees or Company Stores, or within a 50-mile radius of the Territory.
The FDD indicates that these non-compete provisions are subject to state law, meaning that the enforceability and specific terms of these clauses may vary depending on the state in which the franchise operates. Prospective Cool Binz franchisees should consult with a legal professional to understand the specific implications of these non-compete provisions in their state.