What is the duration of the non-compete covenant for a Baya Bar developer after the termination 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.
8.4 Reasonableness of Restrictions.
Developer acknowledges and agrees that the covenants not to compete set forth in this Agreement are fair and reasonable and will not impose any undue hardship on Developer since Developer has other considerable skills, experience and education which afford Developer the opportunity to derive income from other endeavors.
- 8.5 Reduction of Time or Scope.
If the period of time or the geographic scope specified above, should be adjudged unreasonable in any proceeding, then the period of time will be
Source: Item 23 — RECEIPTS (FDD pages 56–189)
What This Means (2024 FDD)
According to Baya Bar's 2024 Franchise Disclosure Document, a developer is subject to a non-compete covenant for 24 months following the expiration or termination of the Development Agreement. During this period, the developer is restricted from engaging in activities that could harm Baya Bar's business.
Specifically, the developer cannot directly or indirectly divert business or customers from Baya Bar outlets to competitors. They are also prohibited from participating in any capacity (owner, partner, director, officer, employee, consultant, or agent) in a retail or café business featuring acai or similarly prepared smoothies or bowls within five miles of the Development Area or any Baya Bar location.
Furthermore, the developer must not take any action that could be injurious or prejudicial to the goodwill associated with Baya Bar's trademarks and system, or interfere with the business of the franchisor or any Baya Bar developers or franchisees. However, if any of these restrictions regarding time or scope are deemed unreasonable, they can be reduced to be enforceable.