After the termination of a Jersey Mikes franchise agreement, for how long are franchisees and their immediate family members restricted from owning or engaging in a similar business?
Jersey_Mikes Franchise · 2025 FDDAnswer from 2025 FDD Document
Accordingly, Franchisee covenants that except as otherwise approved in writing by Franchisor, neither Franchisee nor any of Franchisee's immediate family members shall, for period of two (2) years after the expiration, Transfer or termination of this Agreement, or if later, the date upon which Franchisee complies with the covenants of this Agreement, regardless of the cause of termination, either directly or indirectly, for itself, or through, on behalf of, or in conjunction with any person, persons, partnership, corporation, limited liability company or other entity, own, maintain, engage in, or have any interest in any business
Source: Item 22 — CONTRACTS (FDD page 77)
What This Means (2025 FDD)
According to the 2025 Jersey Mikes Franchise Disclosure Document, franchisees and their immediate family members face a restriction on owning or engaging in a similar business for two years after the termination, transfer, or expiration of the franchise agreement. This restriction applies regardless of the cause of termination. The restriction begins either after the termination date or the date upon which the franchisee complies with the agreement's covenants, whichever is later.
Specifically, neither the franchisee nor their immediate family can own, maintain, engage in, or have any interest in any business that specializes in the sale of submarine-type sandwiches or prepared food products similar to those sold within the Jersey Mikes system. This restriction is in place to protect Jersey Mikes' confidential information, including promotional, operational, sales, and marketing methods that franchisees receive during their training.
This type of non-compete clause is common in franchising to protect the brand and prevent franchisees from using the franchisor's proprietary information to compete against the system after leaving. Prospective Jersey Mikes franchisees should carefully consider the implications of this restriction, especially if they have prior experience or future aspirations in the food service industry. It is important to understand the scope and enforceability of the non-compete agreement before entering into a franchise agreement.