Which sections of the Crepe De Licious Franchise Agreement survive termination or expiration?
Crepe_De_Licious Franchise · 2025 FDDAnswer from 2025 FDD Document
Area Developer covenants that, except as otherwise approved in writing by Franchisor, for a continuous uninterrupted period of two (2) years from the date of (a) a transfer permitted under Section 7 above; (b) expiration of this Agreement; (c) termination of this Agreement (regardless of the cause for termination); (d) a final order of a duly authorized arbitrator, panel of arbitrators, or a court of competent jurisdiction (after all appeals have been taken) with respect to any of the foregoing or with respect to enforcement of this Section 8.3; or (e) any or all of the foregoing, Area Developer shall not either directly or indirectly, for itself, or through, on behalf of, or in conjunction with any person, partnership, corporation, or other entity, own, maintain, operate, engage in, be employed by, or have any interest in any Competitive Restaurant, which is, or is intended to be (i) located within the Development Area (other than those Franchised Restaurant provided for in the Development Schedule), or makes offers and sales into the Development Area; or (ii) located within a radius of twenty-five (25) miles of any other Crepe Delicious Restaurant located anywhere.
Provided, however, that this provision shall not apply to the operation by Area Developer of any business under the System under a franchise agreement with Franchisor.
Source: Item 22 — CONTRACTS (FDD page 57)
What This Means (2025 FDD)
According to the 2025 Crepe De Licious Franchise Disclosure Document, Section 8.3 of the Area Developer Agreement outlines specific post-termination obligations. This section states that for two years after the agreement's transfer, expiration, termination (regardless of cause), or a final order from an arbitrator or court, the Area Developer is restricted from engaging in any Competitive Restaurant.
A Competitive Restaurant is defined as one that sells or offers crepe-based food items or gelato. This restriction applies if the Competitive Restaurant is located within the Development Area (excluding already franchised locations) or within a 25-mile radius of any other Crepe De Licious Restaurant.
However, this non-compete provision does not prevent the Area Developer from operating another Crepe De Licious franchise under a separate agreement with the Franchisor. There is also an exception for ownership in public entities, although the details of this exception are not provided in the excerpt.
This clause ensures that upon leaving the Crepe De Licious system, an Area Developer cannot immediately leverage their knowledge and experience to directly compete with existing franchisees or the Franchisor within a defined geographic area. This is a fairly standard practice in franchising to protect the brand and other franchisees.