After termination, can a former Mr. Sandless franchisee have any interest in a Competitive Business?
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, a former franchisee is restricted from engaging in any competitive business for a period of two years after termination. This restriction applies to owning, maintaining, operating, consulting for, performing services for, or having any interest in a business that offers wood floor refinishing, wood-free 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.
The non-compete extends to businesses located within the franchisee's designated territory, 50 miles of that territory, or 50 miles of any other Mr. Sandless business. This means a franchisee cannot operate a competing business within these specified areas for the two-year duration.
There are exceptions to this restriction. The prohibitions do not apply to interests or activities connected with another Mr. Sandless Franchised Business. Also, the restriction does not apply if the former franchisee owns less than 5% of the securities of any publicly held corporation. This allows for minor investments in larger, publicly traded companies that may have some competitive overlap, without violating the non-compete agreement.