Does the Craters & Freighters post-term restrictive covenant prevent soliciting customers of Craters & Freighters company-owned businesses?
Craters_Freighters Franchise · 2025 FDDAnswer from 2025 FDD Document
raters & Freighters company-owned or Affiliate-owned business, to any Competitive Business by direct or indirect inducement or otherwise.
- 15.3 Post-Term Restrictive Covenants. For a period of two (2) years after the expiration, transfer, or termination of this Agreement, Franchisee and its owner(s) may not, directly or indirectly, for themselves or through, on behalf of, or in conjunction with any other person, partnership, or corporation:
- 15.3.1 Perform any services for, consult for, engage in, acquire, lend money to, extend credit to, have any interest in, or be employed as an officer, director, e
Source: Item 22 — CONTRACTS (FDD pages 49–50)
What This Means (2025 FDD)
According to the 2025 Craters & Freighters Franchise Disclosure Document, the post-term restrictive covenants do address soliciting customers of Craters & Freighters company-owned businesses. Specifically, for a period of two years after the expiration, transfer, or termination of the Franchise Agreement, a franchisee cannot divert, attempt to divert, or solicit business or customers of any Craters & Freighters Franchised Business, or any Craters & Freighters company-owned or Affiliate-owned business, to any Competitive Business. This restriction is in place regardless of direct or indirect inducement.
This means that after leaving the Craters & Freighters system, a former franchisee is prohibited from actively trying to win over customers of existing Craters & Freighters franchises or company-owned locations to a competing business. This restriction applies broadly to all customers of Craters & Freighters, not just those the franchisee personally served during their time in the system.
The non-solicitation clause is in place for a period of two years and applies to Craters & Freighters franchised, company-owned, and affiliate-owned businesses. This is a fairly standard practice in franchising to protect the brand and the customer base that has been built by the entire franchise system. Franchisees should be aware of these limitations as they plan their future business activities after leaving the Craters & Freighters system.