Does the Crawlspace Medic agreement allow for exceptions to the non-competition covenants if approved in writing by the Franchisor?
Crawlspace_Medic Franchise · 2024 FDDAnswer from 2024 FDD Document
In consideration for such specialized training, trade secrets, Confidential Information and rights, Franchisee and each Principal, if any, covenant that, except as otherwise approved in writing by Franchisor:
- 19.5.1.
During the term of this Agreement, Franchisee and each Principal, if any, shall not, either directly or indirectly, for themselves or through, on behalf of, or in conjunction with, any person or entity (i) divert, or attempt to divert, any business or customer of the Franchised Business or of other franchisees in the System to any competitor, by direct or indirect inducement or otherwise; (ii) participate as an owner, partner, director, officer, employee, consultant or agent or serve in any other capacity in any crawlspace or basement service business similar to the System; or (iii) seek to employ any person who is at that time employed by Franchisor or otherwise induce such person to leave his or her employment; or (iv) do or
Source: Item 22 — CONTRACTS (FDD page 42)
What This Means (2024 FDD)
According to the 2024 Crawlspace Medic Franchise Disclosure Document, the non-competition covenants can be waived if the franchisor provides written approval. During the term of the agreement, franchisees and their principals are restricted from engaging in any competitive crawlspace or basement service business, soliciting Crawlspace Medic's customers, or employing Crawlspace Medic's personnel, unless the franchisor gives written consent.
Post-termination, the franchisee is restricted from operating a similar business within 25 miles of their territory or any Crawlspace Medic location for a period of 24 months. However, this restriction is also subject to written approval from Crawlspace Medic. This condition provides some flexibility for franchisees who may want to pursue related business ventures, provided they obtain the franchisor's consent.
Crawlspace Medic also retains the right to reduce the scope of any covenant within the agreement at its sole discretion. This modification becomes effective immediately once the franchisee receives written notice. The franchisee must then comply with the modified covenant. This clause gives Crawlspace Medic the power to adjust the non-compete terms, potentially making them less restrictive for the franchisee. This could be beneficial if a franchisee wants to explore a business opportunity that might otherwise be in conflict with the non-compete agreement.