What discretion does Bb.Q Chicken have regarding the non-competition covenants for personnel?
Bb_Q_Chicken Franchise · 2025 FDDAnswer from 2025 FDD Document
You must also retain other personnel as are needed to operate and manage the Franchised Business. Your General Manager and all other personnel who will have access to our proprietary and confidential information and training must sign our Confidentiality and Non-Competition Agreement which is attached to our Franchise Agreement as Attachment 4. We will be a third-party beneficiary of each agreement with the independent right to enforce the agreement's terms. We have the right, in our discretion, to decrease the period of time or geographic scope of the non-competition covenants contained in the attachments or eliminate the non-competition covenants altogether for any party that must sign an agreement as described in this paragraph.
Source: Item 15 — OBLIGATION TO PARTICIPATE IN THE ACTUAL OPERATION OF THE FRANCHISED BUSINESS (FDD pages 47–48)
What This Means (2025 FDD)
According to Bb.Q Chicken's 2025 Franchise Disclosure Document, Bb.Q Chicken has the right to modify or eliminate non-competition agreements for personnel. Specifically, Bb.Q Chicken can decrease the time period or geographic scope of these covenants, or even eliminate them entirely. This applies to any party required to sign a non-competition agreement as outlined in the franchise agreement. These agreements are typically included as Attachment 4 to the Franchise Agreement and must be signed by the General Manager and any other personnel with access to Bb.Q Chicken's proprietary and confidential information and training. Bb.Q Chicken is considered a third-party beneficiary of these agreements and has the independent right to enforce their terms.
This discretion provides Bb.Q Chicken with flexibility in managing its franchise network. It allows them to tailor non-competition requirements based on specific circumstances or individual roles within a franchise. For a prospective franchisee, this means that the standard non-competition terms outlined in the agreement may be subject to change at Bb.Q Chicken's discretion.
This flexibility could be beneficial in attracting qualified personnel who might be hesitant to agree to overly restrictive non-competition terms. However, it also introduces an element of uncertainty, as the franchisee cannot be certain whether Bb.Q Chicken will choose to modify or eliminate these covenants for their employees. It is important for prospective franchisees to understand the standard terms of the non-competition agreement and to discuss with Bb.Q Chicken the potential for modifications or waivers.
In the franchise industry, non-competition agreements are a common tool used to protect a franchisor's confidential information and customer relationships. The specific terms of these agreements, including their duration and geographic scope, can vary widely depending on the franchise system and the nature of the business. Bb.Q Chicken's approach of retaining the right to modify or eliminate these covenants provides them with a degree of control over this aspect of the franchise relationship.