Gringo's Restaurant is a small restaurant located in a Mesa,Arizona,neighborhood shopping center that has a grocery store (chain)as its anchor tenant.Carl Williams owns Gringo's and has just negotiated its sale to Wilma Freestone.The covenant not to compete provides that Williams will not open a competing restaurant anywhere within a two-mile radius of Gringo's for a period of two years.The noncompete covenant is:

Question

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The noncompete covenant that Carl Williams agreed to is likely reasonable and enforceable given that it is limited in scope (two-mile radius) and duration (two years). Noncompete agreements are generally subject to a reasonableness standard and will be evaluated on a case-by-case basis. In this scenario, the covenant is likely designed to protect the legitimate business interests of the purchaser (Wilma Freestone), and it does not appear to be overly restrictive or anti-competitive. Therefore, it is likely to be enforceable.

Gringo's Restaurant Is a Small Restaurant Located in a Mesa,Arizona,neighborhood