Are there any specific provisions related to non-disparagement that a Red Wagon Club franchisee must adhere to after the termination or expiration of the franchise agreement?
Red_Wagon_Club Franchise · 2024 FDDAnswer from 2024 FDD Document
luding any of Franchisee's employees having access to Confidential Information. Franchisor has the right to regulate the form of agreement that Franchisee uses and to be a third-party beneficiary of that agreement with independent enforcement rights.
8.B. NON-DISPARAGEMENT.
Franchisee agrees not to (and to use Franchisee's best efforts to cause Franchisee's current and former owners, officers, directors, agents, partners, employees, representatives, attorneys, spouses, affiliates, successors, and assigns not to) (i) disparage or otherwise speak or write negatively, directly or indirectly, of Franchisor, its affiliates, any of Franchisor's or its affiliates' directors, officers, employees, representatives or affiliates, the "Red Wagon Club" brand, the System, any Business, any business using the Marks, or (ii) take any other action which would, directly or indirectly, subject the "Red Wagon Club" brand to ridicule, scandal, reproach, scorn, or indignity, or which would negatively impact the goodwill of Franchisor or the "Red Wagon Club" brand.
**9.
Source: Item 22 — CONTRACTS (FDD page 47)
What This Means (2024 FDD)
According to the 2024 Red Wagon Club Franchise Disclosure Document, franchisees are subject to non-disparagement provisions that extend beyond the term of the franchise agreement. Franchisees must not speak or write negatively, directly or indirectly, about Red Wagon Club, its affiliates, directors, officers, employees, representatives, or the "Red Wagon Club" brand. This obligation also extends to the System, any Business, any business using the Marks.
This non-disparagement clause also requires franchisees to use their best efforts to ensure that their current and former owners, officers, directors, agents, partners, employees, representatives, attorneys, spouses, affiliates, successors, and assigns also adhere to these restrictions. The franchisee must ensure that no actions are taken that would subject the "Red Wagon Club" brand to ridicule, scandal, reproach, scorn, or indignity, or negatively impact the goodwill of Red Wagon Club.
Furthermore, the franchise agreement states that adhering to all provisions within the agreement, including those related to non-disparagement, survives the expiration or termination of the agreement. This means that even after the franchise relationship ends, the franchisee remains bound by the non-disparagement obligations outlined in the franchise agreement. This is a fairly standard practice in franchising to protect the brand's reputation and goodwill even after a franchise ceases operations.