During the term of the Punch King Fitness franchise, what activities are considered a breach of the noncompetition covenant?
Punch_King_Fitness Franchise · 2024 FDDAnswer from 2024 FDD Document
| Pr | ovision | Section in Franchise Agreement | Summary |
|---|---|---|---|
| p. | Your death or disability | Section XVI(E) | Must transfer to an approved 3rd party within 6 months, subject to all conditions except the transfer fee. |
| q. | Noncompetition covenants during the term of the franchise | Section XIX(A)(3) | No involvement in a competing business; cannot assist or deal with a competing business; cannot infringe on another franchisee's territorial rights. |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 42–53)
What This Means (2024 FDD)
According to Punch King Fitness's 2024 Franchise Disclosure Document, the noncompetition covenant during the term of the franchise is detailed in Section XIX(A)(3) of the Franchise Agreement. Breaching this covenant involves several specific actions.
The franchisee is prohibited from any involvement in a competing business. This means the franchisee cannot own, operate, or have any financial interest in a business that offers similar fitness services or products as Punch King Fitness.
Additionally, the franchisee is barred from assisting or dealing with a competing business. This includes providing support, resources, or services to any business that competes with Punch King Fitness. Furthermore, the franchisee must not infringe on the territorial rights of other Punch King Fitness franchisees, ensuring that each franchise can operate without encroachment from others within the system.