What is the definition of 'In-Term Restricted Period' for a Hawaiian Bros Island Grill franchise?
Hawaiian_Bros_Island_Grill Franchise · 2025 FDDAnswer from 2025 FDD Document
A party may at any time change the address to which notices are to be sent, or other contact information, by giving the other at least 10 days' prior notice in accordance with this Section.
12. RESTRICTIVE COVENANTS.
- (a) In consideration of Company's providing operations and training to Developer and disclosing to Developer the System and other Trade Secrets, Developer and its Controlling Principals agree to the following non-competition and non-solicitation covenants:
- (i) During the term of this Agreement, Developer and each Controlling Principal, for so long as such Controlling Principal has an Ownership Interest in Developer (the "In-Term Restricted Period"), will not own or operate, directly or indirectly, or accept employment by, hold an interest in, lend money to, serve as guarantor for, or perform services in any capacity for, any Competitive Business (as defined below) that is located, operates, advertises or provides services in the United States or in any other country where a Hawaiian Bros Restaurant is located.
Source: Item 23 — RECEIPTS (FDD pages 77–262)
What This Means (2025 FDD)
According to the 2025 Hawaiian Bros Island Grill FDD, the 'In-Term Restricted Period' refers to the duration during which a franchisee and their controlling principals are subject to certain non-compete and non-solicitation covenants. Specifically, this period lasts for as long as the franchise agreement is in effect and a controlling principal maintains an ownership interest in the franchise.
During this 'In-Term Restricted Period', the franchisee and their controlling principals are restricted from owning, operating, or being involved with any 'Competitive Business'. A 'Competitive Business' is defined as any island-inspired or Hawaiian-themed restaurant, or any restaurant that advertises and serves island-inspired or Hawaiian cuisine. These restrictions apply to any such business located in the United States or any other country where a Hawaiian Bros Island Grill restaurant is located.
This means that while operating a Hawaiian Bros Island Grill franchise, a franchisee and their controlling principals cannot simultaneously own or work for a competing restaurant concept. This restriction is in place to protect Hawaiian Bros Island Grill's market share, trade secrets, and overall brand integrity. Franchisees should carefully consider these restrictions and ensure they do not have any conflicting business interests before entering into a franchise agreement.