factual

After the Jersey Mikes Franchise Agreement is terminated, for how long is the non-competition covenant in effect?

Jersey_Mikes Franchise · 2025 FDD

Answer from 2025 FDD Document

Provision Section in Franchise Agreement Summary
p. Your death or disability Section 20 Your heirs, beneficiaries, devisees or legal representative can apply to Company to continue operation of the Franchised Restaurant or sell or otherwise transfer interest in the Franchised Restaurant following death or incapacity of any person owning 50% or more interest in Franchisee. If they fail t o meet th ese conditions, the Franch ise Agreement will terminate and Company will have the option to buy the Franchised Restaurant.
q. Non-competition covenants during the term of the franchise Section 16.3 You must not divert or attempt to divert any business or customer to a competitor, or perform any act which may harm the goodwill associated with the marks and the System; or own or otherwise have any interest in any business (including a business you currently operate) specializing in the sa le of submarine-type sandwiches or prepared food products the same as or similar to any product or service provided through the System.
r. Non-competition covenants after the franchise is terminated or expires Section 16.4 You must not own, maintain, engage in, consult with or have any interest in any business specializing in the sale of submarine-type sandwiches or prepared food products the same as or similar to any other product or service provided through the System for 2 years after the Franchise Agreement is terminated within the Metropolitan Statistical Area, as defined by the United States Census Bureau, in which the Franchised Restaurant is located or within a 10-mile radius of the Franchised Restaurant or within a 10-mile radius of any other business using the System.

Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 57–64)

What This Means (2025 FDD)

According to Jersey Mikes' 2025 Franchise Disclosure Document, if the Franchise Agreement is terminated, the non-competition covenant lasts for 2 years. During this period, the franchisee is restricted from owning, maintaining, engaging in, or consulting with any business specializing in the sale of submarine-type sandwiches or prepared food products similar to those offered by Jersey Mikes.

The restriction applies within the Metropolitan Statistical Area, as defined by the United States Census Bureau, where the franchised restaurant is located. It also extends to a 10-mile radius of the franchised restaurant or any other business using the Jersey Mikes system.

This non-compete clause is a standard practice in franchising to protect the brand and prevent former franchisees from using the franchisor's knowledge and trade secrets to compete against the system. Prospective franchisees should carefully consider the implications of this clause, especially if they plan to remain in the food service industry after leaving the Jersey Mikes system.

Disclaimer: This information is extracted from the 2025 Franchise Disclosure Document and is provided for research purposes only. It does not constitute legal or financial advice. Consult with a franchise attorney before making any investment decisions.