Who is restricted from engaging in a similar business to B Bops during the term of the agreement?
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, during the term of the Development Agreement, the developer, along with their directors, officers, shareholders, partners, members, principals, or agents, are restricted from directly or indirectly engaging in any business that is the same as or substantially similar to a B Bops Restaurant. The only exception to this restriction is for any B Bops unit that the developer owns and operates under a Unit Franchise Agreement with B Bops.
Following the termination or expiration of the Development Agreement, this restriction extends for a period of two years. During this time, the developer and the associated parties mentioned above cannot engage 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 and operated by B Bops, its affiliates, or another franchisee. However, the developer can continue to own and operate any B Bops unit under a Unit Franchise Agreement.
The FDD specifies that a business is considered "the same as or substantially similar to a B-Bop's Restaurant" if it prepares and serves to the public any food items that are part of the standard B Bops Restaurant menu. This non-compete clause ensures that the developer focuses solely on developing and operating B Bops Restaurants during the agreement and prevents them from using the acquired knowledge and resources to compete with B Bops after the agreement ends.