Does the B Bops non-compete apply to businesses 'directly' similar to a B Bops Restaurant after the agreement terminates?
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.
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- ASSIGNMENT BY DEVELOPER.
Source: Item 23 — RECEIPTS (FDD pages 53–145)
What This Means (2025 FDD)
According to the 2025 B Bops Franchise Disclosure Document, the non-compete agreement does apply to businesses that are the same as or substantially similar to a B Bops Restaurant after the termination or expiration of the Development Agreement. Specifically, for a period of two years after the agreement ends, the developer (franchisee) cannot engage in a similar business within the Trade Area or within a 20-mile radius of any B Bops Restaurant. This restriction applies to the developer, their directors, officers, shareholders, partners, members, principals, or agents.
The FDD defines a business as "the same as or substantially similar to a B-Bop's Restaurant" if it is engaged in preparing and serving to the public any food items included as a standard menu item for a B Bops Restaurant. This definition is important because it clarifies the scope of the non-compete, focusing on the actual menu items offered rather than just the general concept of a fast-food restaurant.
This non-compete clause ensures that former franchisees do not directly compete with B Bops by opening a similar restaurant nearby, protecting B Bops' market share and brand recognition. However, the franchisee is allowed to continue operating any Unit pursuant to a Unit Franchise Agreement entered into with B Bops, until and unless such Unit Franchise Agreement is terminated in accordance with its terms.