After termination or expiration of the Eos Worldwide Franchise Agreement, for how long are franchisees prohibited from soliciting clients to a competitive business, as stated in Item 17 and Section 16.6(a) in North Dakota?

According to the 2025 Eos Worldwide Franchise Disclosure Document, Item 17 and Section 16.6(a) of the Franchise Agreement generally prohibit franchisees from soliciting clients to a competitive business for one year after the termination or expiration of the Franchise Agreement. However, for franchisees in North Dakota, this restriction may not be enforceable.

Specifically, the FDD states that covenants not to compete are generally considered unenforceable in North Dakota. The North Dakota Securities Commissioner has determined that these covenants restricting competition are contrary to Section 9-08-06 of the North Dakota Century Code and are considered unfair, unjust, or inequitable under Section 51-19-09 of the North Dakota Franchise Investment Law.

This means that while the standard Eos Worldwide franchise agreement includes a one-year non-solicitation clause, this clause is unlikely to be upheld in North Dakota. An Eos Worldwide franchisee operating in North Dakota may be able to solicit clients for a competitive business immediately after their franchise agreement ends, without legal repercussions. However, because the FDD states that non-compete agreements may be enforceable in 'limited instances as provided by law', a prospective franchisee should consult with a legal expert to fully understand the implications of this.