After the expiration or termination of the Deck Medic Franchise Agreement, for how long is the franchisee prohibited from participating in a competitive business?
Deck_Medic Franchise · 2024 FDDAnswer from 2024 FDD Document
You, and if you are a partnership or Corporate Entity, each of your members, shareholders and/or partners (collectively, "Owners"), must personally guarantee all of your obligations to us under the Franchise Agreement. Each Owner and Owner's spouse must personally guarantee your obligations to us under the Franchise Agreement. You must also promise in writing that, among other things, during the term of the Franchise Agreement you will not participate in any business that in any way competes with a Deck Medic Business, and that for 24 months after the expiration of termination of the Franchise Agreement (with said period being tolled during any periods of noncompliance), you will not participate in any competitive business located within and/or servicing customers located within your Operating Territory and a 25 mile radius surrounding your Operating Territory. Further you will not participate in any competitive business located within and/or servicing customers located within the operating territory of any other Deck Medic Business. Your managers will be required by us to sign a confidentiality agreement.
Source: Item 15 — OBLIGATION TO PARTICIPATE IN THE ACTUAL OPERATION OF THE FRANCHISE BUSINESS (FDD pages 33–34)
What This Means (2024 FDD)
According to Deck Medic's 2024 Franchise Disclosure Document, franchisees are restricted from engaging in any competitive business for a period of 24 months after the termination or expiration of the Franchise Agreement. This 24-month period can be extended if the franchisee is non-compliant, with the period being tolled during any periods of noncompliance.
The non-compete clause applies within the franchisee's Operating Territory and extends to a 25-mile radius surrounding it. Furthermore, franchisees are prohibited from participating in any competitive business located within or servicing customers within the operating territory of any other Deck Medic Business.
This restriction is a standard practice in franchising to protect the brand and other franchisees from unfair competition. Prospective Deck Medic franchisees should carefully consider the implications of this non-compete agreement, especially if they plan to remain in the same geographic area after leaving the Deck Medic system. It is important to understand the scope and limitations of the non-compete clause before signing the Franchise Agreement.