What can Crave do if I violate the confidentiality and non-competition agreement?
Crave Franchise · 2025 FDDAnswer from 2025 FDD Document
d. Covenantor shall not at any time, directly or indirectly, do any act or omit to do any act that would or would likely be injurious or prejudicial to the goodwill associated with the System.
2. Covenants Not to Compete.
a. In order to protect the goodwill and unique qualities of the System, and in consideration for the disclosure to Covenantor of the Confidential Information, Covenantor further agrees and covenants that during the term of the Franchise Agreement, Covenantor shall not, for Covenantor or through, on behalf of or in conjunction with any person or entity:
(i) divert, or attempt to divert, any business or customer of any Crave outlet or of other franchisees in the System to any competitor, by direct or indirect inducement or otherwise, or
(ii) participate as an owner, partner, director, officer, employee, consultant or agent or serve in any other capacity in any restaurant or food service business featuring menu items which are the same or substantially similar to those offered in the Crave System.
b. In further consideration for the disclosure to Covenantor of the Confidential Information and to protect the goodwill and unique qualities of the System, Covenantor further agrees and covenants that, upon the termination of the Franchise Agreement and continuing for two (2) years thereafter, Covenantor shall not, for Covenantor or through, on behalf of or in conjunction with any person or entity:
(i) divert, or attempt to divert, any business or customer of any Crave outlet or of other franchisees in the Crave System to any competitor, by direct or indirect inducement or otherwise, or
(ii) participate as an owner, partner, director, officer, employee, or consultant or serve in any other managerial, operational or supervisory capacity in any restaurant or food service business featuring menu items which are the same or substantially similar to those offered in the Crave System within ten (10) miles of the Designated Territory or any Crave outlet location.
c. The parties acknowledge and agree that each of the covenants contained herein are reasonable limitations as to time, geographical area, and scope of activity to be restrained and do not impose a greater restraint than is necessary to protect the goodwill or other business interests of Franchisor.
Source: Item 23 — RECEIPTS (FDD pages 63–253)
What This Means (2025 FDD)
According to Crave's 2025 Franchise Disclosure Document, franchisees are bound by confidentiality and non-compete agreements to protect Crave's System and goodwill. During the term of the Franchise Agreement, franchisees cannot divert business from any Crave outlet to a competitor or participate in any food service business featuring similar menu items to Crave.
Upon termination of the Franchise Agreement, the non-compete extends for two years. During this period, franchisees are prohibited from diverting business from Crave outlets or participating in a similar food service business within ten miles of the Designated Territory or any Crave outlet location. These restrictions are acknowledged as reasonable to protect Crave's business interests.
If a franchisee violates these agreements, Crave has the right to enforce the terms to protect its confidential information, System, and market position. The FDD does not explicitly detail the specific legal remedies Crave may pursue, such as seeking an injunction or monetary damages, but it establishes the franchisee's obligation to maintain confidentiality and refrain from competitive activities, thus laying the groundwork for Crave to take action if these obligations are breached.