Does the Mr. Sandless non-compete agreement apply if the franchise agreement expires?
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 the 2025 Mr. Sandless Franchise Disclosure Document, the Confidentiality and Non-Competition Agreement includes a non-compete clause that extends for a period after the termination of the franchise agreement. Specifically, this agreement restricts the franchisee (or a former employee) from engaging in similar businesses or services offered by Mr. Sandless.
The non-compete restrictions apply for a continuous, uninterrupted period of two years after the termination of the franchisee's position, regardless of the reason for termination. During this period, the franchisee is prohibited from owning, maintaining, operating, consulting for, performing services for, or having any interest in a business that offers wood floor refinishing, wood floor care, wood floor cleaning, 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 selling products similar to those offered by Mr. Sandless. This restriction applies unless the activity is within a Mr. Sandless Business.
The geographic scope of the non-compete agreement covers the franchisee's designated territory, as well as an area within 50 miles of that territory, and also within 50 miles of any other Mr. Sandless Business. However, the restrictions do not apply to ownership of less than 5% of the securities of a publicly held corporation. A prospective franchisee should carefully consider the implications of this non-compete agreement, particularly if they plan to operate a similar business after the Mr. Sandless franchise agreement expires or is terminated.