What is the definition of 'Competitive Business' in the Beef O Bradys agreement?
Beef_O_Bradys Franchise · 2025 FDDAnswer from 2025 FDD Document
, association, service or ownership participation, and under the circumstances set forth in the following paragraph, for a period of two years immediately following its expiration or termination for any reason, I will not, directly or indirectly engage or participate in any Competitive Business, as defined below. I agree that I am prohibited from engaging in any Competitive Business as a proprietor, partner, investor, shareholder, director, officer, employee, principal, agent, advisor, or consultant.
The term "Competitive Business" means any business or facility owning, operating, managing or granting franchises or licenses to others to own, operate or manage, any bar, sports pub, restaurant, food service facility or other business that features menu items, products and/or services similar to any of the menu items, products and/or services offered by the Family Sports Pubs, including, by way of example and without limitation, any restaurant, bar or catering service
that offers chicken wings, beef, hamburgers, chicken, or sandwiches or any bar which operates as a sports pub (other than a Family Sports Pub under a franchise agreement with us)
For a period of two years immediately following the expiration or termination of my employment, association, service or ownership participation, I am prohibited from engaging in any Competitive Business, if the other business is located at any of Developer's Sites or within Developer's Development Area; within fifteen miles of any of Developer's Sites or Developer's Development Area, or, within fifteen miles of any other Family Sports Pub planned, in operation or under construction on the later of the effective date of the termination or expiration of the Area Development Agreement.
It is the intention of these provisions to preclude not only direct competition but also all forms of indirect competition, such as consultation for Competitive Businesses, service as an independent contractor for Competitive Businesses, or any assistance or transmission of information of any kind which would be of any material assistance to a competitor.
Source: Item 23 — RECEIPTS. (FDD pages 66–330)
What This Means (2025 FDD)
According to the 2025 Beef O Bradys FDD, a 'Competitive Business' is defined as any business or facility that owns, operates, manages, or grants franchises or licenses to others for businesses that are similar to Beef O Bradys Family Sports Pubs. This includes bars, sports pubs, restaurants, food service facilities, or other businesses that feature similar menu items, products, and/or services.
Specifically, the definition includes, but is not limited to, any restaurant, bar, or catering service that offers items like chicken wings, beef, hamburgers, chicken, or sandwiches. It also encompasses any bar that operates as a sports pub, excluding other Beef O Bradys franchises.
This definition is important for prospective franchisees as it outlines the scope of activities they are restricted from engaging in, both during the term of their franchise agreement and for a specified period after its termination or expiration. It is designed to prevent direct and indirect competition, including consultation or service as an independent contractor for competing businesses. However, a franchisee is allowed to own up to 5% of the capital stock of a publicly held Competitive Business for investment purposes, provided they do not control the company.