Does the geographic restriction on similar businesses after termination of the agreement apply to B Bops restaurants under construction?
B_Bops Franchise · 2025 FDDAnswer from 2025 FDD Document
e parties hereto.
- B. Developer hereby agrees that for a period of two (2) years immediately following the termination or expiration of this Agreement, Developer, its directors, officers, shareholders, partners, members, principals or agents will not, directly or indirectly, enter into or engage in any business the same as or substantially similar to a B-Bop's Restaurant operating at any location within the Trade Area or within a twenty (20) mile radius of any other B-Bop's Restaurant then in operation or under construction, whether owned and operated by Company, any affiliate of Company or by a franchisee under license granted by Company, except that Developer shall be entitled to continue to own and operate any Unit pursuant to a Unit Franchise Agreement entered into between the parties hereto.
- C. For purposes of this Section 12, a business shall be deemed the "same as or substantially similar to a B-Bop's Restaurant" if the business is engaged in preparing and serving to the public any food items included from time to time as a standard menu item for a B-Bop's Restaurant.
-
- ASSIGNMENT BY DEVELOPER.
Source: Item 23 — RECEIPTS (FDD pages 53–145)
What This Means (2025 FDD)
According to B Bops's 2025 Franchise Disclosure Document, the geographic restriction on similar businesses after termination of the agreement does apply to B Bops restaurants under construction. Specifically, for two years after the agreement ends, the franchisee cannot engage in a similar business within the Trade Area or within a 20-mile radius of any B Bops restaurant in operation or under construction.
This restriction prevents a former B Bops franchisee from immediately opening a competing restaurant nearby and leveraging the knowledge and experience gained while operating their B Bops franchise. The restriction applies not only to existing B Bops restaurants but also to those that are currently under construction, further limiting the franchisee's options.
However, the agreement does allow the franchisee to continue operating any B Bops unit under a separate Unit Franchise Agreement, provided that agreement remains in effect. This exception acknowledges the franchisee's existing investment and ongoing obligations related to those specific units. The definition of a "substantially similar" business is one that prepares and serves any food items that are standard menu items for B Bops restaurants.