Does the Kitchen Solvers non-compete agreement apply to owners of the franchise?
Kitchen_Solvers Franchise · 2025 FDDAnswer from 2025 FDD Document
valuable training, confidential information and goodwill that you otherwise would not receive or have access to but for the rights licensed to you under this Agreement. You therefore agree to the following noncompetition covenants:
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- Unless otherwise specified, the term "you" as used in this subparagraph 10.D includes, collectively and individually, all owners, guarantors, officers, directors, members, managers, partners, as the case may be, and holders of any ownership interest in you. We may require you to obtain from the individuals identified in the preceding sentence a signed noncompete agreement in a form satisfactory to us that contains the non-compete provisions of this subparagraph 10.D.
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- You covenant that during the term of this Agreement you will not, except as we otherwise agree to in writing, either directly or indirectly, for yourself, or through, on behalf of, or in conjunction with any person or entity, own, manage, operate, maintain, engage in, consult with or have any interest in any construction or remodeling business or any other business selling products and services similar to your KITCHEN SOLVERS Business other than the one authorized by this Agreement or any other agreement between us and you.
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- You covenant that you will not, for a period of two (2) years after the expiration or termination of this Agreement, regardless of the cause of termination, or within two (2) years of the sale of the KITCHEN SOLVERS Business or any interest in you, either directly or indirectly, for yourself, or through, on behalf of, or in conjunction with any person or entity, own, manage, operate, maintain, engage in, consult with or have any interest in a Competing Business:
- a. Inside the Territory;
b. Within twenty –five (25) miles of the outer boundary of the Territory; or
c. Within any other franchisee's territory; or
d. Within twenty-five (25) miles of the outer boundary of another franchisee's territory.
For purposes of this Section 10.D, a Competing Business includes any: (a) kitchen and/or bathroom remodeling business, cabinet refacing business and/or any other business that sells products and services similar to the products and services sold at your KITCHEN SOLVERS Business; and/or (b) business that franchises or licenses the right to open and operate a business of the type identified in (a) of this provision.
- You agree that the length of time in subpart (3) will be tolled for any period during which you are in breach of the covenants or any other period during which we seek to enforce this Agreement. The parties agree that each of the foregoing covenants will be construed as independent of any other covenant or provision of this Agreement.
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Source: Item 22 — Contracts (FDD page 49)
What This Means (2025 FDD)
According to the 2025 Kitchen Solvers Franchise Disclosure Document, the non-compete agreement does apply to owners of the franchise. The agreement specifies that the term "you" includes all owners, guarantors, officers, directors, members, managers, partners, and holders of any ownership interest in the franchisee. Kitchen Solvers may also require these individuals to sign a separate non-compete agreement.
During the term of the franchise agreement, franchisees and their owners are prohibited from owning, managing, operating, or having any interest in any construction or remodeling business or any business selling similar products and services to Kitchen Solvers, unless otherwise agreed to in writing by Kitchen Solvers. This restriction applies to activities conducted directly or indirectly, whether for themselves or in conjunction with any other person or entity.
After the franchise agreement expires or terminates, or after the sale of the Kitchen Solvers business, a similar non-compete restriction applies for a period of two years. During this two-year period, franchisees and their owners are restricted from engaging in a Competing Business within the defined territory. The territory includes the franchisee's designated territory, within 25 miles of the territory's outer boundary, within any other franchisee's territory, or within 25 miles of another franchisee's territory. A Competing Business includes any kitchen and/or bathroom remodeling business, cabinet refacing business, or any business that sells similar products and services, as well as any business that franchises or licenses the right to open and operate such a business.
It is important to note that the length of the post-term non-compete period may be extended if the franchisee is in breach of the agreement or if Kitchen Solvers seeks to enforce the agreement. These non-compete covenants are designed to protect Kitchen Solvers' confidential information, training, and goodwill, and are fairly standard within the franchise industry.