During the term of the Baya Bar agreement, can a Developer divert business from other franchisees to a competitor?
Baya_Bar Franchise · 2024 FDDAnswer from 2024 FDD Document
- 8.3.1 During the term of this Agreement, 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 the Developer's Baya Bar outlets or of other developers or franchisees in the System to any competitor, by direct or indirect inducement or otherwise; (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; 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 or Franchisor-affiliated outlets.
Source: Item 23 — RECEIPTS (FDD pages 56–189)
What This Means (2024 FDD)
According to Baya Bar's 2024 Franchise Disclosure Document, during the term of the agreement, a developer is prohibited from diverting business or customers to a competitor. Specifically, the developer cannot directly or indirectly induce customers away from their Baya Bar outlets or other franchisees within the Baya Bar system.
This restriction extends to the developer not being allowed to participate as an owner, partner, director, officer, employee, consultant, or agent in any retail or café business featuring acai or similarly prepared smoothies or bowls. This prevents the developer from using their knowledge and experience gained from Baya Bar to benefit a competing business.
The Baya Bar agreement also states that developers must not perform any actions that could be harmful or prejudicial to the goodwill associated with the Baya Bar brand and system. Additionally, they are prohibited from interfering with, disturbing, disrupting, decreasing, or otherwise jeopardizing the business of Baya Bar, its developers, franchisees, or Franchisor-affiliated outlets. These measures are in place to protect the Baya Bar system and maintain its competitive advantage.