What is the geographic scope of the post-term non-compete restriction for a Crepe De Licious Area Developer?
Crepe_De_Licious Franchise · 2025 FDDAnswer from 2025 FDD Document
ecifications, proprietary practices and procedures, policies, marketing strategies, and information comprising the System and the Manual.
"Manual" means our confidential operations manual for the operation of a Crepe de licious business, which may be periodically modified by us.
"Marks" means the logotypes, service marks, and trademarks now or hereafter involved in the operation of a Crepe de licious business, including "CREPE DE LICIOUS," and any other trademarks, service marks, or trade names that we designate for use by a Crepe de licious business. The term "Marks" also includes any distinctive trade dress used to identify a Crepe de licious business, whether now in existence or hereafter created.
"Prohibited Activities" means any or all of the following: (i) owning, operating, or having any other interest (as an owner, partner, director, officer, employee, manager, consultant, shareholder, creditor, representative, agent, or in any similar capacity) in a Competitive Business (other than owning an interest of five percent (5%) or less in a publicly-traded company that is a Competitive Business); and/or (ii) diverting or attempting to divert any business from us (or one of our affiliates or franchisees).
"Restricted Period" means the two-year period after you cease to be a manager or officer of Franchisee's Crepe de licious business; provided, however, that if a court of competent jurisdiction determines that this period of time is too long to be enforceable, then the "Restricted Period" means the 12 month period after you cease to be a manager or officer of Franchisee's Crepe de licious business.
"Restricted Territory" means the geographic area within: (i) a 25-mile radius from Franchisee's Crepe de licious business (and including the premises of the approved location of Franchisee); and (ii) a 25 mile radius from all other Crepe de licious businesses that are operating or under construction as of the beginning of the Restricted Period; provided, however, that if a court of competent jurisdiction determines that the foregoing Restricted Territory is too broad to be enforceable, then the "Restricted Territory" means the geographic area within a 12-mile radius from Franchisee's Crepe de licious business (and including the premises of the approved location of Franchisee).
"System" means our system for the establishment, development, operation, and management of a Crepe de licious business, including Know-how, proprietary programs and products, Manual, and operating system.
- 2. Background. You are a manager or officer of Franchisee. As a result of this relationship, you may gain knowledge of our System. You understand that protecting the Intellectual Property and our System are vital to our success and that of our franchisees and that you could seriously jeopardize our entire System if you were to unfairly compete with us. In order to avoid such damage, you agree to comply with the terms of this Agreement.
- 3. Know-How and Intellectual Property. You agree: (i) you will not use the Know-how in any business or capacity other than the Crepe de licious business operated by Franchisee; (ii) you will maintain the confidentiality of the Know-how at all times; (iii) you will not make unauthorized copies of documents containing any Know-how; (iv) you will take such reasonable steps as we may ask of you from time to time to prevent unauthorized use or disclosure of the Know-how; and (v) you will stop using the Know-how immediately if you are no longer a manager or officer of Franchisee's Crepe de licious business. You further agree that you will not use all or part of the Intellectual Property or all or part of the System for any purpose other than the performance of your duties for Franchisee and within the scope of your employment or other engagement with Franchisee. These restrictions on Know-how, Intellectual Property and the System shall not apply to any information which is information publicly known or becomes lawfully known in the public domain other than through a breach of this Agreement or is required or compelled by law to be disclosed, provided that you will give reasonable notice to us to allow us to seek protective or other court orders.
- 4. Unfair Competition During Relationship. You agree not to unfairly compete with us at any time while you are a manager or officer of Franchisee's Crepe de licious business by engaging in any Prohibited Activities.
- 5. Unfair Competition After Relationship. You agree not to unfairly compete with us during the Restricted Period by engaging in any Prohibited Activities; provided, however, that the Prohibited Activity relating to having an interest in a Competitive Business will only apply with respect to a Competitive Business that is located within or provides competitive goods or services to customers who are located within the Restricted Territory.
Source: Item 22 — CONTRACTS (FDD page 57)
What This Means (2025 FDD)
According to the 2025 Crepe De Licious Franchise Disclosure Document, a manager or officer of a Crepe De Licious franchise is subject to post-term non-compete restrictions. Specifically, they cannot engage in prohibited activities within a defined "Restricted Territory." This territory is defined as the geographic area within a 25-mile radius of both the franchisee's Crepe De Licious business location and any other Crepe De Licious businesses that are either operating or under construction at the beginning of the restricted period.
However, the FDD also states that if a court deems the 25-mile radius too broad to be enforceable, the restricted territory shrinks to a 12-mile radius from the franchisee's Crepe De Licious business.
Prohibited activities include owning, operating, or having any interest in a competitive business, or diverting business away from Crepe De Licious. The restriction on having an interest in a competitive business applies only to businesses located within or providing goods or services to customers within the restricted territory. The restricted period lasts for two years after the manager or officer ceases their affiliation with the Crepe De Licious franchise, but this period may be reduced to 12 months if a court finds the two-year term too long to be enforceable. If the manager or officer engages in prohibited activities during the restricted period, the period is extended by the amount of time they were engaging in those activities.
These restrictions do not apply to information that is publicly known or legally becomes public, unless the disclosure results from a breach of the agreement. Crepe De Licious also retains the right to modify the terms of the agreement to ensure enforceability, including reducing the geographic scope of the restricted territory.