During the term of the Development Agreement, can a B Bops developer engage in a business substantially 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, a developer is restricted from engaging in any business that is the same as or substantially similar to a B Bops Restaurant during the term of the Development Agreement. However, this restriction does not apply to any B Bops Unit that the developer owns and operates under a Unit Franchise Agreement with B Bops. This means a developer can operate existing B Bops locations while under the Development Agreement, but cannot start a competing restaurant.
After the Development Agreement expires or is terminated, the developer is further restricted for two years 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. Again, this does not prevent the developer from continuing to operate any B Bops Unit they own under a Unit Franchise Agreement.
The FDD defines a business as "the same as or substantially similar to a B-Bop's Restaurant" if it involves preparing and serving food items that are part of the standard B Bops menu. This definition is important because it clarifies the scope of the non-compete agreement, focusing on direct competition through similar menu offerings rather than broader restaurant concepts.