After the Fitstop agreement terminates, does the non-compete apply if another Fitstop franchise is 'under development'?
Fitstop Franchise · 2024 FDDAnswer from 2024 FDD Document
ion or nonrenewal of this Agreement for any reason, no payment is due to you from any source on account of any goodwill or other equity claimed by you arising from your operation or ownership of the Franchise, or otherwise.
- 16.9 Survival of Certain Provision Upon Expiration or Termiantion of Agreement. All of the provisions of this Agreement, which by their terms or by implication apply following the termination of this Agreement shall indeed survive and apply following the termination of this Agreement.
Source: Item 23 — RECEIPTS (FDD pages 50–135)
What This Means (2024 FDD)
Based on the 2024 Fitstop Franchise Disclosure Document, the document does not specify whether the non-compete agreement applies if another Fitstop franchise is 'under development' after the agreement terminates. However, Section 16.9 states that provisions of the agreement that apply following the termination of the agreement shall survive and apply following the termination of the agreement. Section 18.7 states that Fitstop acknowledges that a violation of any of the terms of this Section would result in irreparable injury to Fitstop for which no adequate remedy at law may be available.
To fully understand the implications, a prospective Fitstop franchisee should seek clarification from the franchisor regarding the specific terms and conditions of the non-compete agreement, particularly in situations where another Fitstop franchise is under development. This inquiry should aim to determine whether 'under development' is considered a violation of the non-compete terms.
It would also be prudent to consult with a legal professional to review the franchise agreement and assess the enforceability of the non-compete clause in their specific jurisdiction.