How are 'affiliates' of a Bananas Smoothies Frozen Yogurt developer defined in the context of the agreement?
Bananas_Smoothies_Frozen_Yogurt Franchise · 2025 FDDAnswer from 2025 FDD Document
Developer also acknowledges that Franchisor has entered into this Agreement with Developer in part in consideration of and in reliance on Developer's agreement to deal exclusively with Franchisor.
Therefore, you agree as follows:
(a) Noncompetition and Non-solicitation: During the term of this Agreement neither Developer nor any of Developer's Owners if Developer is a Business Entity (a "Restricted Person") will:
(i) engage in a Competitive Business or perform services for a Competitive Business, directly or indirectly, as a director, owner, proprietor, officer, manager, employee, consultant, representative, agent, independent contractor or otherwise, except under a franchise agreement with Franchisor or Franchisor's affiliates;
(ii) have any direct or indirect interest, as a disclosed or beneficial owner, in a Competitive Business, except under franchise agreements with Franchisor or Franchisor's affiliates;
(iii) have any direct or indirect interest, as a disclosed or beneficial owner, in any entity which is granted or is granting franchises or licenses to others to operate any Competitive Business, except EYB Concepts under franchise agreements with Franchisor or Franchisor's affiliates; or
Source: Item 23 — RECEIPT (FDD pages 58–231)
What This Means (2025 FDD)
Based on the 2025 Bananas Smoothies Frozen Yogurt Franchise Disclosure Document, the term 'affiliates' is referenced within the context of competitive restrictions and business activities, but the document does not provide a specific definition of what constitutes an 'affiliate' of the developer.
However, the FDD does outline certain restrictions on the developer and their owners regarding competitive businesses. The developer is restricted from engaging in or having an interest in any business that competes with Bananas Smoothies Frozen Yogurt, except under a franchise agreement with the franchisor or its affiliates. This suggests that 'affiliates' in this context could refer to entities that are closely associated with the franchisor and authorized to operate or franchise similar businesses.
Since the precise definition of 'affiliates' is not provided, it is important for a prospective Bananas Smoothies Frozen Yogurt franchisee to seek clarification from the franchisor regarding the scope and implications of this term. Understanding who is considered an 'affiliate' is crucial for assessing potential competitive conflicts and ensuring compliance with the area development agreement.