After the Dog Haus agreement expires or terminates, what geographic area is covered by the non-compete agreement?
Dog_Haus Franchise · 2025 FDDAnswer from 2025 FDD Document
Except as Franchisor otherwise approves in writing, commencing upon the date of: (i) an Assignment permitted under Article 9; (ii) the Expiration Date of this Agreement; (iii) the termination of this Agreement (regardless of the cause for termination); or (iv) a final court order (after all appeals have been taken) with respect to any of the foregoing events or with respect to enforcement of this Section 13.3, and continuing for an uninterrupted period of two (2) years thereafter, Area Developer and each Owner shall not, own (either beneficially or of record), engage in or render services to, whether as an investor, partner, lender, director, officer, manager, employee, consultant, representative or agent, any Competitive Business located at a location designated as a "Franchised Location" in a Franchise Agreement between Franchisor, as franchisor, and Area Developer, or an Affiliate or Owner of Area Developer, as franchisee, except in accordance with the terms of an effective Franchise Agreement between Franchisor, as franchisor, and Area Developer, or an Affiliate or Owner of Area Developer, as franchisee, or any location within a two (2) mile radius of any Dog Haus Restaurant or a Franchised Location as defined above; provided, however, the restrictions stated in this Section 13.3 shall not apply to any Owner after two (2) years from the date the Owner ceases to be an officer, director, shareholder, member, manager, trustee, owner, general partner, employee or otherwise associated in any capacity with Area Developer in the Development Area.
- 13.4 Exceptions to Non-Compete Covenants.
Sections 13.2 and 13.3 shall not apply to ownership by Area Developer or an Owner of a less than five percent (5%) beneficial interest in the outstanding equity securities of any Competitive Business registered under the Securities Act of 1833 or the Securities Exchange Act of 1834.
Source: Item 23 — RECEIPTS (FDD pages 87–328)
What This Means (2025 FDD)
According to Dog Haus's 2025 Franchise Disclosure Document, after the agreement expires or terminates, the non-compete agreement restricts the Area Developer and each Owner from being involved in a Competitive Business. This restriction applies for two years after the agreement's expiration, termination, or a final court order related to these events.
The geographic scope of this non-compete includes any location designated as a "Franchised Location" in a Franchise Agreement between Dog Haus and the Area Developer (or their affiliates), or any location within a two-mile radius of any Dog Haus Restaurant or a Franchised Location. This means that for a period of two years, the franchisee cannot operate or be associated with a competing business within this defined area.
However, there is an exception: these restrictions do not apply to any Owner after two years from the date they cease to be associated with the Area Developer. Additionally, the non-compete covenants do not apply to ownership of less than 5% of the equity securities of any Competitive Business registered under the Securities Act of 1833 or the Securities Exchange Act of 1834. This allows for minor investments in publicly traded competitors without violating the agreement.