What is the maximum duration of a non-compete covenant required by Crave Cookies after termination or failure to renew a franchise?
Crave_Cookies Franchise · 2025 FDDAnswer from 2025 FDD Document
- (9) Requiring a franchisee to covenant not to compete with the franchisor for a period longer than three years or in an area greater than the exclusive area granted by the franchise agreement or, in absence of such a provision in the agreement, an area of reasonable size, upon termination of or failure to renew the franchise.
Source: Item 23 — RECEIPTS (FDD pages 47–194)
What This Means (2025 FDD)
According to Crave Cookies' 2025 Franchise Disclosure Document, the maximum length of time for a non-compete covenant is three years. This restriction applies if a franchisee's agreement is terminated or not renewed.
This means that after a franchise agreement ends, a former Crave Cookies franchisee could be prohibited from competing with Crave Cookies for up to three years. The non-compete area is limited to the exclusive territory granted in the franchise agreement. If there is no exclusive territory defined in the agreement, the non-compete area must be of a reasonable size.
Non-compete clauses are common in franchise agreements to protect the brand and business model. Prospective Crave Cookies franchisees should carefully consider the implications of this restriction, especially if they plan to remain in the same geographic area and industry after leaving the Crave Cookies system. It is important to fully understand the scope and enforceability of the non-compete agreement before signing the franchise agreement.