After the Deck Medic franchise relationship ends, does the prohibition on having an interest in a Competitive Business apply everywhere?
Deck_Medic Franchise · 2024 FDDAnswer from 2024 FDD Document
6.C. RESTRICTIVE COVENANTS: CONFIDENTIAL INFORMATION
Franchisee agrees that, at all times, both during the Term of this Agreement and after its expiration or termination, Franchisee: (a) shall not use the Confidential Information in any business or capacity other than the Deck Medic Business operated by Franchisee; (b) shall maintain the confidentiality of the Confidential Information at all times; (c) shall not make unauthorized copies of documents containing any Confidential Information; (d) shall take such reasonable steps as Franchisor may ask of Franchisee from time to time to prevent unauthorized use or disclosure of the Confidential Information; and (e) shall stop using the Confidential Information immediately upon the expiration, termination or Transfer of this Agreement. Franchisee agrees that the foregoing covenants and obligations shall also apply to: (a) Franchisee's Owners and Spouses and that Franchisee's Owners and Spouses shall each execute and deliver to Franchisor the Franchise Owner and Spouse Agreement and Guaranty in the form attached to this Agreement as Exhibit 1; and (b) Franchisee's directors, officers, employees and agents where disclosure of the Confidential Information was necessary for the operations of the Franchised Business and where such director, officer, employee and/or agent previously executed and timely delivered to Franchisor the Confidentiality Agreement in the form attached as Exhibit 2.
Source: Item 23 — RECEIPTS (FDD pages 43–228)
What This Means (2024 FDD)
According to Deck Medic's 2024 Franchise Disclosure Document, the restrictive covenants regarding unfair competition apply post-termination. However, the document does not specify the geographic scope of these post-termination non-compete obligations.
Specifically, the FDD states that franchisees agree not to use confidential information in any business other than their Deck Medic business, and they must maintain the confidentiality of this information at all times, even after the agreement expires or terminates. This obligation extends to the franchisee's owners, spouses, directors, officers, employees, and agents.
Because the FDD does not specify the geographic scope of the post-termination non-compete agreement, prospective franchisees should seek clarification from Deck Medic regarding the geographic limitations of these restrictions. Understanding the geographic scope of the non-compete agreement is crucial for franchisees planning their future business activities after leaving the Deck Medic system.