What activities are prohibited under the non-competition covenants after the Expense Reduction Analysts franchise is terminated or expires?
Expense_Reduction_Analysts Franchise · 2025 FDDAnswer from 2025 FDD Document
| PROVISION | SECTION IN FRANCHISE AGREEMENT | SUMMARY |
|---|---|---|
| principals, guarantors, owners or Practice Model | ||
| Consultants, may: (i) own, operate, or otherwise | ||
| be involved with, Competing Business (as | ||
| defined in the Franchise Agreement); (ii) employ | ||
| or seek to employ any of employees or us, our | ||
| affiliates or any other System franchisee or | ||
| induce such persons to leave their employment; | ||
| or (iii) divert, or attempt to divert, any | ||
| prospective customer to a Competing Business. | ||
| r. Non-competition covenants after the franchise is terminated or expires | 28.6 | For a period of twenty-four (24) months after the termination/expiration/transfer of your Franchise Agreement, neither you, your principals, guarantors, owners, nor any immediate family member of you, your principals, guarantors, owners, may be involved with any business competing in whole or in part with Franchisor granting franchises or licenses for Competing Businesses. For a period of twenty-four (24) months after the termination/expiration/transfer of your Franchise Agreement, neither you, your principals, guarantors, owners, nor any immediate family member of you, your principals, guarantors, owners, may own, operate or otherwise be involved with and Competing Business: (i) at the Premises; (ii) within your Area; (iii) within a fifty (50) mile radius of the perimeter of your Area or any other Area granted by Franchisor in connection with an ERA Business as of the date your Franchise Agreement expires or terminates. During this twenty-four (24) month period, |
| these parties are also prohibited from: (i) | ||
| soliciting business from customers of your | ||
| former Consulting Business; (ii) contacting any of | ||
| our suppliers/vendors for a competitive business | ||
| purpose; or (iii) soliciting any employees of us, | ||
| our affiliates or any other System franchisee to | ||
| discontinue their employment. |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER, AND DISPUTE RESOLUTION THE FRANCHISE RELATIONSHIP (FDD pages 43–46)
What This Means (2025 FDD)
According to Expense Reduction Analysts's 2025 Franchise Disclosure Document, after the termination, expiration, or transfer of a franchise agreement, certain non-competition covenants apply for 24 months. These restrictions apply to the franchisee, their principals, guarantors, owners, and their immediate family members.
Specifically, these individuals are prohibited from involvement with any business that competes, either wholly or partially, with Expense Reduction Analysts in granting franchises or licenses for competing businesses. They cannot own, operate, or be involved with a Competing Business at the former franchise premises, within the franchisee's Area, or within a 50-mile radius of the perimeter of the Area or any other Area granted by Expense Reduction Analysts.
Additionally, during this 24-month period, these individuals are barred from soliciting business from customers of the former Consulting Business, contacting Expense Reduction Analysts's suppliers or vendors for competitive purposes, or soliciting employees of Expense Reduction Analysts, its affiliates, or other System franchisees to discontinue their employment.