factual

What is the nature of the covenants, agreements, and obligations assumed by the franchisee and any principal in the Devon Creek franchise?

Devon_Creek Franchise · 2024 FDD

Answer from 2024 FDD Document

WHEREAS, Franchisee desires to enter into a franchise agreement with Franchisor for a Devon Creek franchised business ("Franchise Agreement") which will allow Franchisee to conduct internet-based advertising, maintain social media accounts, use software, and use telephone listings linked to the Devon Creek brand.

WHEREAS, Franchisor would not enter into the Franchise Agreement without Franchisee's agreement to enter into, comply with, and be bound by all the terms and provisions of this Agreement;

NOW, THEREFORE, for and in consideration of the foregoing and the mutual promises and covenants contained herein, and in further consideration of the Franchise Agreement and the mutual promises and covenants contained therein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:

1. Definitions

All terms used but not otherwise defined in this Agreement shall have the meanings set forth in the Franchise Agreement. "Termination" of the Franchise Agreement shall include, but shall not be limited to, the voluntary termination, involuntary termination, or natural expiration thereof.

In consideration for such specialized training, trade secrets, Confidential Information and rights, Franchisee and each Principal covenant that, except as otherwise approved in writing by Franchisor:

  • 19.5.1 During the term of this Agreement, Franchisee and each Principal shall not, either directly or indirectly, for themselves or through, on behalf of, or in conjunction with, any person or entity (i) divert, or attempt to divert, any business, customer or referral source of the Franchised Business or of other franchisees in the System to any competitor, by direct or indirect inducement or otherwise; (ii) participate as an owner, partner, director, officer, employee, consultant or agent or serve in any other capacity in any residential or commercial lawncare or servicing business similar to the System; or (iii) do or perform, directly or indirectly, any other act injurious or prejudicial to the goodwill associated with the Marks and the System or (iv) in any

  • 19.5.2 Upon the expiration or earlier termination of this Agreement or upon a Transfer and continuing for twenty-four (24) months thereafter, Franchisee and Principals shall not, either directly or indirectly, for themselves or through, on behalf of or in conjunction with any person or entity (i) divert, or attempt to divert, any business, customer or referral source of the Franchised Business, Franchisor or of other franchisees in the System to any competitor, by direct or indirect inducement or otherwise; or (ii) participate as an owner, partner, director, officer, employee, consultant or agent or serve in any other capacity in any residential or commercial lawncare business within twenty-five (25) miles of the Territory or within fifty (50) miles of any Devon Creek office location; or (iii) do or perform, directly or indirectly, any other act injurious or prejudicial to the goodwill associated with the Marks and the System or (iv) in any manner interfere with, disturb, disrupt, decrease or otherwise jeopardize the business of the Franchisor or any Devon Creek franchisees.

  • 18.1 Franchisee's Obligations. Upon termination or expiration of this Agreement, all rights and licenses granted hereunder to Franchisee shall immediately terminate and Franchisee and each Principal shall:

    • 18.1.1 immediately cease to operate the Franchised Business, and shall not thereafter, directly or indirectly identify himself, herself or itself as a current Devon Creek owner, franchisee or licensee;
    • 18.1.2 immediately and permanently cease to use the Marks, any imitation of any Mark, Franchisor's copyrighted material or other intellectual property, confidential or proprietary material or indicia of the Franchised Business, or use any trade name, trade or service mark or other commercial symbol that suggests a current or past association with Franchisor, Licensor, or the System. In particular, Franchisee shall cease to use, without limitation, all signs, billboards, advertising materials, displays, stationery, forms and any other articles, which display the Marks;
    • 18.1.3 take such action as may be necessary to cancel any assumed name or equivalent registration that contains the Mark or any other service mark or trademark of Franchisor, and Franchisee shall furnish Franchisor with evidence of compliance with this obligation which is satisfactory to Franchisor, within ten (10) days after termination or expiration of this Agreement;
    • 18.1.4 promptly pay all sums owing to Franchisor and its affiliates. Such sums shall include all damages, costs and expenses, including reasonable attorneys' fees, incurred by Franchisor as a result of any default by Franchisee. The payment obligation herein shall give rise to and remain, until paid in full, a lien in favor of Franchisor against any and all of the personal property, furnishings, equipment,

NOW, THEREFORE, in consideration of the mutual covenants and obligations contained herein, the parties agree as follows:

1. Confidentiality Agreement.

  • a. Covenantor shall, at all times, maintain the confidentiality of the Confidential Information and shall use such Confidential Information only in the course of his or her employment by or association with Franchisee in connection with the operation of a Franchised Business under the Franchise Agreement.
  • b. Covenantor shall not at any time make copies of any documents or compilations containing some or all of the Confidential Information without Franchisor's express written permission.
  • c. Covenantor shall not at any time disclose or permit the disclosure of the Confidential Information except, and only then to the limited extent necessary, to those employees of Franchisee for training and assisting such employees in the operation of the Franchised Business.
  • d. Covenantor shall surrender any material containing some or all of the Confidential Information to Franchisee or Franchisor, upon request, or upon termination of employment or association with Franchisee.
  • e. Covenantor shall not at any time, directly or indirectly, do any act or omit to do any act that would or would likely be injurious or prejudicial to the goodwill associated with the System.

Source: Item 22 — CONTRACTS (FDD page 45)

What This Means (2024 FDD)

According to the 2024 Devon Creek Franchise Disclosure Document, both the franchisee and any principal involved assume several covenants, agreements, and obligations. These cover various aspects of the franchise operation, both during the term of the agreement and after its termination. These obligations include complying with confidentiality agreements, non-compete clauses, and stipulations regarding the use of Devon Creek's intellectual property. Franchisees must engage in internet-based advertising, maintain social media accounts, use software, and use telephone listings linked to the Devon Creek brand. Franchisees must also protect Devon Creek's confidential information.

During the franchise term, franchisees and principals must not divert business from the franchised business or other franchisees, participate in similar lawn care businesses, or act in any way that harms the goodwill associated with the Devon Creek brand. After termination or expiration of the agreement, these restrictions continue for a period of twenty-four months. During this time, franchisees and principals are prohibited from engaging in similar competitive activities within a specified radius of the territory (25 miles) or any Devon Creek office location (50 miles).

Upon termination or expiration of the franchise agreement, the franchisee must cease operating the franchised business and discontinue using Devon Creek's trademarks, copyrighted material, and other intellectual property. They must also cancel any assumed names or registrations that contain Devon Creek's marks. All sums owed to Devon Creek and its affiliates must be promptly paid, and Devon Creek retains a lien against the franchisee's business assets until all debts are settled. These post-termination obligations are designed to protect Devon Creek's brand and market position.

Principals associated with the franchisee are also bound by confidentiality and non-compete agreements. They must maintain the confidentiality of Devon Creek's confidential information and use it only for operating the franchised business. They are prohibited from copying confidential documents or disclosing confidential information to unauthorized parties. Upon termination of their association with the franchisee, they must surrender all materials containing confidential information. These measures ensure that confidential information remains protected and that principals do not use it to compete unfairly with Devon Creek.

Disclaimer: This information is extracted from the 2024 Franchise Disclosure Document and is provided for research purposes only. It does not constitute legal or financial advice. Consult with a franchise attorney before making any investment decisions.