What actions are Bft developers prohibited from undertaking that would negatively impact the goodwill of the Bft franchisor?
Bft Franchise · 2025 FDDAnswer from 2025 FDD Document
F. Non-Disparagement. Developer agrees that it will not (and will use its best efforts to cause its current and former owners, officers, directors, principals, agents, partners, employees, representatives, attorneys, spouses, affiliates, successors and assigns not to) (i) make any untrue or derogatory statements concerning Franchisor and its affiliates, as well as their present and former officers, employees, shareholders, directors, agents, attorneys, servants, representatives, successors and assigns; or (ii) undertake any act which would (a) subject the Marks to ridicule, scandal, reproach, scorn, or indignity, (b) negatively impact the goodwill of Franchisor or its affiliates, the Marks, other components of the System, or any other brands owned or controlled by Franchisor or its affiliates, or (c) constitute an act of moral turpitude (including, without limitation, verbal, physical, or sexual harassment towards any other person).
Notwithstanding the foregoing, nothing in this Agreement or any other agreement with Franchisor restricts or prohibits any person from initiating communications directly with, responding to any inquiries from, providing testimony before, providing confidential information to, reporting possible violations of law or regulation to, or from filing a claim or assisting with an investigation directly with a self-regulatory authority or a government agency or entity, including the U.S. Securities and Exchange Commission, or from making other disclosures that are protected under the whistleblower provisions of state or federal law or regulation. No person needs the prior authorization of Franchisor to engage in conduct protected by the preceding sentence, and no person needs to notify Franchisor that such person has engaged in such conduct.
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 57–66)
What This Means (2025 FDD)
According to Bft's 2025 Franchise Disclosure Document, developers are contractually obligated to avoid actions that could harm the franchisor's reputation and goodwill. This obligation extends not only to the developer but also to their current and former owners, officers, directors, principals, agents, partners, employees, representatives, attorneys, spouses, affiliates, successors, and assigns.
Specifically, Bft developers and related parties must not make untrue or derogatory statements about the franchisor, its affiliates, or their present and former personnel. Furthermore, they are prohibited from any action that could subject Bft's trademarks to ridicule, scandal, reproach, scorn, or indignity. Any behavior that negatively impacts the goodwill of Bft, its affiliates, the trademarks, the System, or any other brands owned or controlled by Bft is also forbidden.
Additionally, Bft developers must refrain from any act of moral turpitude, including verbal, physical, or sexual harassment towards any person. However, the agreement does not prevent anyone from communicating with or providing information to regulatory authorities or government agencies, including reporting potential legal violations, and such actions do not require prior authorization or notification to Bft.