Does the non-solicitation covenant for Punch King Fitness extend to clients of other franchisees?
Punch_King_Fitness Franchise · 2024 FDDAnswer from 2024 FDD Document
Developer further covenants that, except as otherwise approved in writing by Franchisor, Developer shall not, directly or indirectly, for itself or through, on behalf of, or in conjunction with any person, persons, partnership, or corporation:
- 2. for a continuous and uninterrupted period commencing upon the expiration or termination of this Agreement (regardless of the cause for termination) and continuing for two (2) years thereafter, directly or indirectly solicit or perform services for any person who was a client of the Franchised Business at any time during the term of this Agreement.
Source: Item 22 — CONTRACTS (FDD pages 56–215)
What This Means (2024 FDD)
According to Punch King Fitness's 2024 Franchise Disclosure Document, the non-solicitation covenant extends to clients of the franchisee's business only. Specifically, during the term of the Franchise Agreement and for two years after, the franchisee cannot solicit or perform services for anyone who was a client of their Franchised Business during the term of the agreement.
This means a franchisee is restricted from actively pursuing clients they served during their tenure with Punch King Fitness. However, the agreement does not explicitly prevent a former franchisee from soliciting clients of other Punch King Fitness locations.
This distinction is important for prospective franchisees to understand. While they are protected from direct solicitation of their clients by former franchisees, they do not receive the same protection regarding clients of other Punch King Fitness franchises. A prospective franchisee might want to clarify with Punch King Fitness the extent to which the franchisor would intervene if a dispute arose regarding the solicitation of another franchisee's clients.