Does the B Bops non-compete apply to businesses 'indirectly' similar to a B Bops Restaurant?
B_Bops Franchise · 2025 FDDAnswer from 2025 FDD Document
- A. Developer hereby agrees that during the term 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, except for any Unit owned and operated by Developer pursuant to a Unit Franchise Agreement entered into between the 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.
Source: Item 23 — RECEIPTS (FDD pages 53–145)
What This Means (2025 FDD)
According to B Bops's 2025 Franchise Disclosure Document, the non-compete agreement applies to businesses that are directly or indirectly similar to a B Bops Restaurant. During the term of the Development Agreement, the developer, including its directors, officers, shareholders, partners, members, principals, or agents, cannot engage in any business that is the same as or substantially similar to a B Bops Restaurant. This restriction does not apply to any B Bops unit owned and operated by the developer under a Unit Franchise Agreement.
Following the termination or expiration of the Development Agreement, the non-compete restriction continues for two years. During this period, the developer and its associated parties are prohibited from engaging in a similar business within the Trade Area or within a 20-mile radius of any operating or under-construction B Bops Restaurant. This applies whether the restaurant is owned by B Bops, its affiliates, or another franchisee. An exception is made for any unit the developer continues to own and operate under a Unit Franchise Agreement.
For the purposes of the non-compete clause, a business is considered "the same as or substantially similar to a B-Bop's Restaurant" if it prepares and serves any food items that are part of the standard B Bops Restaurant menu. This definition ensures that the non-compete agreement is clearly defined and enforceable, preventing franchisees from opening competing businesses that offer similar food items. This protects B Bops's market share and brand identity within the specified geographic areas.