What development operations must a Baya Bar franchisee cease immediately upon termination or expiration of the agreement?
Baya_Bar Franchise · 2024 FDDAnswer from 2024 FDD Document
- 8.3.2 Upon the expiration or earlier termination of this Agreement or upon a Transfer and continuing for twenty-four (24) months thereafter, Developer shall not, either directly or indirectly, for himself or herself or through, on behalf of or in conjunction with any person or entity (i) divert, or attempt to divert, any business or customer of Developer's Baya Bar outlets 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 retail or café business featuring acai or similarly prepared smoothies or bowls within five (5) miles of the Development Area or any Baya Bar location; 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 developers or franchisees.
Source: Item 23 — RECEIPTS (FDD pages 56–189)
What This Means (2024 FDD)
According to Baya Bar's 2024 Franchise Disclosure Document, a developer faces several restrictions upon the expiration or termination of their Development Agreement. Specifically, for 24 months after the agreement ends, the developer cannot divert or attempt to divert any business or customers from Baya Bar outlets (including those of other franchisees) to any competitor. This includes any direct or indirect actions aimed at inducing customers to switch to a competing business.
Additionally, the developer is prohibited from participating in any retail or café business that features acai or similarly prepared smoothies or bowls within a five-mile radius of the Development Area or any Baya Bar location. This restriction applies whether the developer acts as an owner, partner, director, officer, employee, consultant, agent, or in any other capacity. The aim is to prevent the developer from using their knowledge and experience gained from the Baya Bar system to directly compete with the franchise.
Furthermore, the developer must not engage in any action that could be considered injurious or prejudicial to the goodwill associated with the Baya Bar brand and system. They are also barred from interfering with, disturbing, disrupting, decreasing, or otherwise jeopardizing the business of the franchisor or any Baya Bar developers or franchisees. These comprehensive restrictions are designed to protect Baya Bar's market position and brand reputation after a Development Agreement concludes.