What is the geographic scope of the restriction on operating a competitive Mr. Sandless business after termination?
Mr_Sandless Franchise · 2025 FDDAnswer from 2025 FDD Document
with the Franchise and for a continuous uninterrupted period commencing upon the cessation or termination
of my position with Franchisee, regardless of the cause for termination, and continuing for two (2) years thereafter, either directly or indirectly, for myself, or through, on behalf of, or in conjunction with any person, persons, partnership, or corporation, own, maintain, operate, engage in, act as a consultant for, perform services for, or have any interest in any business offering wood floor refinishing, wood free care, wood floor cleaning, and floor maintenance, outdoor wood refinishing, wood care, wood cleaning, wood maintenance, concrete cleaning and sealing, and other forms of outdoor refinishing, cleaning and maintenance, or any selling any product or products which are the same as, or substantially similar to, any of the products or services offered by a Mr. Sandless Business, except at a Mr. Sandless Business, which is or is intended to be, located within:
- 7.1 the Franchisee's Designated Territory as defined in the Franchise Agreement;
- 7.2 Fifty (50) miles of Franchisee's Designated Territory; or
- 7.3 Fifty (50) miles of any Business operating under the System and the Proprietary Marks.
The prohibitions in this Paragraph 7 do not apply to my interests in or activities performed in connection with a Franchised Business. This restriction does not apply to my ownership of less than a five percent (5%) beneficial interest in the outstanding securities of any publicly held corporation.
Source: Item 22 — CONTRACTS (FDD page 42)
What This Means (2025 FDD)
According to Mr. Sandless's 2025 Franchise Disclosure Document, if a franchisee's relationship with Mr. Sandless ends, they face certain restrictions on operating a similar business. Specifically, for two years after the termination or expiration of the Franchise Agreement, the franchisee cannot be involved in a business that offers wood floor refinishing, wood floor care, wood floor cleaning, floor maintenance, concrete cleaning and sealing, or any similar services or products. This restriction applies regardless of the reason for termination.
The geographic scope of this restriction includes three specific areas. First, the franchisee is restricted within their Designated Territory as defined in the Franchise Agreement. Second, the restriction extends to a 50-mile radius around the franchisee's Designated Territory. Finally, the restriction also covers a 50-mile radius around any other Mr. Sandless Business operating under the Mr. Sandless system and using its proprietary marks.
However, there are a couple of exceptions to these restrictions. The prohibitions do not apply to interests or activities performed in connection with another Mr. Sandless Franchised Business. Also, the restriction does not apply if the franchisee owns less than a 5% beneficial interest in the securities of any publicly held corporation. This means a former franchisee could invest in a large, publicly traded company that happens to offer similar services, as long as their stake remains below the 5% threshold.