After the Baya Bar agreement expires, can franchisees or principals interfere with the business of other Baya Bar franchisees within the restricted geographic area?
Baya_Bar Franchise · 2024 FDDAnswer from 2024 FDD Document
- 19.5.2 Upon the expiration or earlier termination of this Agreement or upon a Transfer and continuing for twenty-four (24) months thereafter, Franchisee and Principals, if any, shall not, either directly or indirectly, for themselves or through, on behalf of or in conjunction with any person or entity (i) divert, or attempt to divert, any business or customer of the Franchised Business or of other franchisees in the System to any competitor, by direct or indirect inducement or otherwise; or (ii) participate as an owner, partner, director, officer, employee, consultant or agent or serve in any other capacity in any café or business serving products similar to the System within five (5) miles of the Territory or any Baya Barlocation; or (iii) do or perform, directly or indirectly, any other act injurious or prejudicial to the goodwill associated with the Marks and the System or (iv) in any manner interfere with, disturb, disrupt, decrease or otherwise jeopardize the business of the Franchisor or any Baya Bar franchisees.
Source: Item 22 — CONTRACTS (FDD page 56)
What This Means (2024 FDD)
According to Baya Bar's 2024 Franchise Disclosure Document, both the franchisee and their principals are restricted from interfering with the Baya Bar business of other franchisees even after the franchise agreement expires or is terminated early. This restriction extends for 24 months following the agreement's end.
Specifically, the franchisee and principals cannot divert or attempt to divert business or customers from other Baya Bar franchisees to a competitor. They are also prohibited from participating in any capacity (owner, partner, director, officer, employee, consultant, or agent) in a café or business that offers similar products to the Baya Bar system within five miles of the franchisee's territory or any Baya Bar location.
Additionally, they must not perform any action that could harm the goodwill associated with the Baya Bar brand or interfere with the business of the franchisor or any Baya Bar franchisees. These restrictions are designed to protect the Baya Bar system and its franchisees from unfair competition and disruption, ensuring a stable business environment even after a franchise agreement concludes.