What is the exception to the post-term covenants regarding ownership interests in a publicly traded company for a Crisp & Green franchisee?

According to Crisp & Green's 2024 Franchise Disclosure Document, there is an exception to the non-compete covenants regarding ownership in publicly traded companies. Specifically, the document states that the franchisee or any immediate family member can own up to five percent of the legal or beneficial ownership interests or voting interests in any company whose equity securities are publicly traded on a securities exchange. This exception exists despite the general non-compete restrictions outlined in the franchise agreement.

This exception allows a Crisp & Green franchisee, or their immediate family, to invest in publicly traded companies that might be considered competitors, provided their ownership stake remains below the five percent threshold. This provides franchisees with some flexibility in their investment portfolios without violating the franchise agreement. The key condition is that the ownership stake must not exceed five percent of the company's equity securities or voting interests.

It is important for prospective Crisp & Green franchisees to understand this exception, as it allows for a certain level of investment diversification. However, franchisees must remain vigilant to ensure their ownership stake does not exceed the permitted limit, as exceeding this limit could be considered a breach of the franchise agreement and could potentially lead to legal repercussions. Franchisees should consult with a legal professional to ensure full compliance with these terms.