After the Endless Summer Sweets agreement expires, for how long is the post-term non-compete restriction in effect?
Endless_Summer_Sweets Franchise · 2024 FDDAnswer from 2024 FDD Document
- (b) Restriction Post Term. For two years after this Agreement expires or is terminated for any reason or, where applicable, for two years after a Transfer, no Restricted Party shall directly or indirectly operate, have any ownership interest in, lend money or provide financial assistance to, provide any services to, or be employed by, any Competitor which is located at the premises upon which the Endless Summer Sweets is or was located or is located or within a twenty-five (25) mile radius of the Franchisee's location or any other Endless Summer Sweets location, whether owned by Franchisor or another Franchisee. Franchisee expressly agrees that the two-year period and the twentyfive (25) mile radius are the reasonable and necessary time and distance needed to protect Franchisor if this Agreement expires or is terminated for any reason. Franchisee agrees that the two-year time period of the non-competition provision shall not accrue during any time period that Franchise or any Restricted Party is in violation of this covenant. If this Agreement is terminated before the Territory is determined,
Source: Item 23 — RECEIPTS (FDD pages 39–125)
What This Means (2024 FDD)
According to the 2024 Endless Summer Sweets Franchise Disclosure Document, the post-term non-compete restriction lasts for two years. This restriction applies to the franchisee, any owner, and any spouse of an owner (referred to as "Restricted Parties").
Specifically, for two years after the franchise agreement expires or is terminated, the Restricted Parties are prohibited from directly or indirectly operating, having any ownership interest in, lending money or providing financial assistance to, providing any services to, or being employed by any competitor. This restriction applies to competitors located at the premises where the Endless Summer Sweets was located or within a 25-mile radius of the franchisee's location or any other Endless Summer Sweets location.
The agreement also states that if a Restricted Party violates the non-compete agreement, the two-year restriction period will be extended by one day for each day of noncompliance. This ensures that Endless Summer Sweets can protect its business interests even if a franchisee attempts to circumvent the non-compete agreement.