What is the target buyer demographic for real estate developments that the undersigned is restricted from developing under the Epcon Communities agreement?
Epcon_Communities Franchise · 2025 FDDAnswer from 2025 FDD Document
tem and promptly return to Franchisor all materials provided to it by Franchisor. Franchisor may, without prior notice, enter upon the premises of any Project of Franchisee and remove or obliterate any Marks at Franchisee's expense. Franchisee shall indemnify and hold Franchisor harmless from and against any claims that Franchisor damaged property in the process of removing or obliterating such Marks.
- 13.7 For a period of two (2) years following the effective date of termination or expiration of this Agreement, whether by lapse of time, sale and/or assignment of the Epcon Communities franchise granted hereunder, or other cause, Franchisee shall not, directly or indirectly, either as a principal, agent, employee, officer, director or member of any corporation or other business entity, as a partner or sole proprietor, or in any other way engage in the ownership, development or construction of any real estate development project that is age restricted or for which the targeted buyers are the 55+ home buyer and includes, but is not limited to, detached and/or attached ranch-style homes (with or without basements or a second floor) that are similar to the homes and communities depicted in Franchisor's Development System, within (a) ten (10) miles of the geographic border of any "Initial Market Area" granted to any franchisee pursuant to any Initial Market Area Agreement, or any other agreement that is effective between such franchisee and Franchisor, (b) ten (10) miles of the geographic border of any "Market Area" granted to any franchisee pursuant to any Market Area Agreement, or any other agreement that is effective between such franchisee and Franchisor, (c) ten (10) miles of the geographic border of any "Reserved Market Area" reserved for any franchisee or prospective franchisee under any Market Hold Agreement or other agreement that is in effect between such party and Franchisor, or, (d) ten (10) miles of any real estate development project of Epcon Communities, LLC or of any business entity affiliated with Epcon Communities, LLC. For purposes of this Section 13.7, the term "Franchisee" shall include any officer, director, shareholder, member or holder of an ownership interest in Franchisee, if Franchisee is a corporation, limited liability company or other business entity, and any partner of Franchisee, if Franchisee is a partnership. The determination of whether this Section 13.7, or Sections 10.2, 10.3, 10.4, 10.5, 10.6 or 10.7 have been breached by Franchisee, and the amount of damages payable to Franchisor as a result of such breach, shall be submitted to arbitration in Columbus, Ohio or another location agreed to by the parties. The arbitration shall be heard before a retired judge or attorney mutually acceptable to the parties. In the event the parties fail to agree upon an arbitrator after reasonable efforts, the arbitration shall be commenced by filing a demand for arbitration with the American Arbitration Association. The arbitration shall be binding on the parties and their successors with no right of appeal. The dispute resolution provisions contained in this Section 13.7 shall constitute the sole and exclusive method for resolving any disputes between the parties arising under this Section 13.7 and/or under Sections 10.2, 10.3, 10.4, 10.5, 10.6 and/or 10.7, except that Franchisor shall have the option to file a civil suit in cases in which it is seeking temporary, preliminary and/or permanent injunctive relief or other relief set forth in Section 14.4 below, in which case Franchisee agrees to venue and jurisdiction as set forth in Section 20.3. The costs of the arbitration, including the arbitrator's fees, shall be borne equally by the parties to the arbitration, unless the arbitrator orders otherwise. Franchisor and Franchisee agree that the foregoing shall be construed as independent of any other covenant or provision of this Agreement.
To the extent any person or entity successfully contests the validity or enforceability of any part of this Section 13.7 in its present form, the covenant or provision in this Section 13.7 shall not be deemed invalid or unenforceable, but shall instead be deemed modified, so as to be valid and enforceable, to provide coverage for the maximum scope that any court of competent jurisdiction or arbitrator will deem reasonable and necessary to protect Franchisor's legitimate interests. Franchisee specifically agrees that a breach or threatened breach of any of Franchisee's obligations under this Section 13.7 would cause Franchisor irreparable harm.
Source: Item 23 — RECEIPTS (FDD pages 86–280)
What This Means (2025 FDD)
According to the 2025 Epcon Communities Franchise Disclosure Document, the undersigned is restricted from engaging in real estate development projects that are age-restricted or target the 55+ home buyer demographic. This restriction applies both during the term of the Franchise Agreement and for a period of two years following its termination or expiration. These restrictions include, but are not limited to, detached and/or attached ranch-style homes (with or without basements or a second floor) that are similar to the homes and communities depicted in Epcon Communities' Development System.
During the term of the agreement, this restriction requires the prior written consent of Epcon Communities Franchising, LLC. However, this provision does not apply to involvement in other Epcon Communities projects by other franchisee business entities or to ownership of less than three percent (3%) of the outstanding stock of any publicly held corporation.
Post-termination, the restriction extends to a ten-mile radius of any Initial Market Area, Market Area, or Reserved Market Area granted to other franchisees, as well as within ten miles of any real estate development project of Epcon Communities, LLC or its affiliates. This measure aims to prevent franchisees from directly competing with the franchisor or other franchisees, especially after the franchise agreement concludes. This non-compete clause is a standard practice in franchising to protect the brand and market share of the franchise system.