After the Deka Lash agreement expires or terminates, for how long are franchisees restricted from offering eyelash extension services?
Deka_Lash Franchise · 2024 FDDAnswer from 2024 FDD Document
- b) Post-Term.
You will not, for a period of two years after expiration or termination of this Agreement, in the Protected Area or within thirty (30) miles of the boundaries of the Protected Area or another Protected Area franchised by us and in operation at that time, directly or indirectly, for a fee or charge, offer or engage in eyelash extension services.
- 12.2 No Solicitation of Customers.
You will not, for a period of two years after expiration or termination of this Agreement, in the Protected Area or within thirty (30) miles of the boundaries of the Protected Area, directly or indirectly solicit the patronage of any client served by your prior Franchised Business during the last 24 months that you were a franchisee, or such shorter time as you were a franchisee, for the purpose of offering such person or entity, for a fee or charge, eyelash extension services.
Source: Item 23 — RECEIPT (FDD pages 63–234)
What This Means (2024 FDD)
According to Deka Lash's 2024 Franchise Disclosure Document, franchisees are subject to a post-term non-compete agreement. This agreement restricts them from offering or engaging in eyelash extension services for a period of two years after the expiration or termination of the Franchise Agreement.
The geographic scope of this restriction includes the franchisee's Protected Area, as well as an area within thirty (30) miles of the boundaries of the Protected Area. This also applies to any other Protected Area franchised by Deka Lash and in operation at that time. The restriction applies to offering or engaging in eyelash extension services directly or indirectly, and for a fee or charge.
In addition to the non-compete clause, Deka Lash franchisees are also prohibited from soliciting the patronage of any client served by their former Franchised Business during the last 24 months of operation (or the entire period they were a franchisee, if shorter). This restriction also lasts for two years after the agreement's expiration or termination and applies within the Protected Area or within thirty (30) miles of its boundaries. These measures are designed to protect Deka Lash's market share and customer relationships.
These post-term covenants are typical in franchising to protect the brand and prevent former franchisees from using the franchisor's confidential information and goodwill to compete against the system. Prospective Deka Lash franchisees should carefully consider the implications of these restrictions, particularly if they plan to remain in the same geographic area and continue offering similar services after leaving the Deka Lash system.