What does the Dryer Vent Squad franchisee agree to regarding the reasonableness of the restrictive covenants?
Dryer_Vent_Squad Franchise · 2024 FDDAnswer from 2024 FDD Document
s due to Franchisor under this Agreement. Among other things and without limitation to the foregoing, Franchisee expressly agrees that any claim by Franchisee as to the alleged non-performance of Franchisor's obligations shall not permit and/or entitle Franchisee to withhold payments due Franchisor under this Agreement.
ARTICLE 6 RESTRICTIVE COVENANTS AND OBLIGATIONS
6.A. NECESSITY FOR RESTRICTIVE COVENANTS
Franchisee agrees that only through the course of entering into this Agreement is Franchisee being provided with access to the System, Franchisor's training, use of the Licensed Marks, and access to the Operations Manual and Confidential Information. Franchisee agrees that competition by Franchisee, Owners, and/or their immediate family members will jeopardize the System and cause irreparable harm to Franchisor and franchisees of Dryer Vent Squad Businesses. Accordingly, Franchisee and Franchisee's Owners agree to comply with the restrictive covenants set forth in this Agreement, including this Article 6.
6.B. RESTRICTIVE COVENANTS: KNOW-HOW
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 Know-How in any business or capacity other than the operation of the Franchised Business pursuant to this Agreement and as instructed by Franchisor; (b) shall maintain the confidentiality of the Know-How at all times; (c) shall not make unauthorized copies of documents containing any Know-How; (d) shall take all reasonable steps that Franchisor requires from time to time to prevent unauthorized use or disclosure of the Know-How; and (e) shall stop using the Know-How immediately upon the expiration, termination or Transfer of this Agreement. Franchisee agrees that the foregoing covenants shall also apply to: (a) Franchisee's Owners and, that Franchisee's Owners shall each execute and deliver to Franchisor the Franchise Owner Agreement and Individual Guaranty in the form attached to this Agreement as Exhibit 1;
Source: Item 23 — RECEIPTS (FDD pages 51–207)
What This Means (2024 FDD)
According to the 2024 Dryer Vent Squad FDD, the franchisee acknowledges the necessity of restrictive covenants, agreeing that access to the Dryer Vent Squad system, training, licensed marks, operations manual, and confidential information is contingent upon adhering to these covenants. The franchisee recognizes that their competition, or that of their owners or immediate family, would jeopardize the Dryer Vent Squad system and cause irreparable harm to Dryer Vent Squad and its franchisees. Therefore, the franchisee and their owners commit to complying with all restrictive covenants outlined in the agreement.
Dryer Vent Squad franchisees also agree that if they or their owners fail to comply with these restrictive covenants, it will cause irreparable harm to Dryer Vent Squad and its other franchisees, for which there is no adequate remedy at law. Any violation of these covenants entitles Dryer Vent Squad to seek injunctive relief. Dryer Vent Squad can pursue this injunctive relief without posting a bond, provided they give due notice. The franchisee's sole remedy, should such an injunction be issued, is to seek its dissolution if warranted after a hearing. The franchisee also waives all claims for damages resulting from the wrongful issuance of any such injunction.
Furthermore, if a court requires a bond despite the agreement, the franchisee agrees that the bond amount will not exceed $1,000. Dryer Vent Squad's remedies for breaches of these covenants are not exclusive and can be combined with other remedies available under the agreement, at law, or in equity. These remedies include injunctive relief, specific performance, and recovery of monetary damages. This comprehensive agreement underscores the importance Dryer Vent Squad places on protecting its system and brand from unfair competition, ensuring that franchisees understand and accept the potential legal ramifications of violating these covenants.