What activities are prohibited regarding competitive businesses during the term of employment with a Bb.Q Chicken franchisee?
Bb_Q_Chicken Franchise · 2025 FDDAnswer from 2025 FDD Document
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- Except as otherwise approved in writing by the Company, I shall not, while in my position with the Franchisee, either directly or indirectly for myself, or through, on behalf of, or in conjunction with any person, persons, partnership, or corporation, own, maintain, operate, engage in, act as a consultant for, perform services for, or have any interest in any food service business which: (a) is the same as, or substantially similar to, a Franchised Business; or (b) offers to sell or sells any products or services which are the same as, or substantially similar to, any of the products offered by a Franchised Business (a "Competitive Business"); and for a continuous uninterrupted period commencing upon the cessation or termination of my position with Franchisee, regardless of the cause for termination, or upon the expiration, termination, transfer, or assignment of the Franchise Agreement, whichever occurs first, and continuing for two (2) years thereafter, either directly or indirectly, for myself, or through, on behalf of, or in conjunction with any person, persons, partnership, or corporation, own, maintain, operate, engage in, act as a consultant for, perform services for, or have any interest in any Competitive Business that is, or is intended to be, located at or within:
- 7.1 Franchisee's Designated Territory, as defined in the Franchise Agreement ("Franchisee's Territory");
- 7.2 One-half (0.5) mile of Franchisee's Territory; or
- 7.3 One-half (0.5) mile of any Franchised Business operating under the System and the Proprietary Marks.
The prohibitions in this Paragraph 7 do not apply to my interests in or activities performed in connection with a Franchised Business. This restriction does not apply to my ownership of less than five percent (5%) beneficial interest in the outstanding securities of any publicly held corporation.
Source: Item 23 — RECEIPTS (FDD pages 62–283)
What This Means (2025 FDD)
According to Bb.Q Chicken's 2025 Franchise Disclosure Document, while in a position with a Bb.Q Chicken franchisee, an employee is restricted from engaging in certain activities related to competitive food service businesses, unless otherwise approved in writing by the company. Specifically, the employee cannot directly or indirectly own, maintain, operate, engage in, act as a consultant for, perform services for, or have any interest in a food service business that is the same as or substantially similar to a Bb.Q Chicken franchised business. This also applies to businesses that offer to sell or sell products or services that are the same as or substantially similar to those offered by a Bb.Q Chicken franchise.
These restrictions extend beyond the termination of employment. For a continuous, uninterrupted period starting from the end of employment with the franchisee, regardless of the reason for termination, or upon the expiration, termination, transfer, or assignment of the Franchise Agreement, and continuing for two years, the former employee is prohibited from engaging in similar competitive activities. This includes owning, maintaining, operating, engaging in, acting as a consultant for, performing services for, or having any interest in a competitive business within specific geographic boundaries.
The geographic limitations include the franchisee's designated territory, as defined in the Franchise Agreement, and areas within one-half mile of the franchisee's territory or any Bb.Q Chicken franchised business operating under the Bb.Q Chicken system and proprietary marks. However, these prohibitions do not apply to interests or activities related to a Bb.Q Chicken franchised business. Additionally, the restriction does not apply to ownership of less than five percent beneficial interest in the outstanding securities of any publicly held corporation.
These non-compete terms are fairly standard in the franchise industry to protect the brand and prevent franchisees and their employees from using learned knowledge to directly compete. A prospective franchisee should carefully consider these restrictions and how they might impact future employment opportunities for themselves and their employees. It is important to understand the specific definitions of "Competitive Business" and "Designated Territory" in the Franchise Agreement to fully grasp the scope of these limitations.