Under the Bft franchise agreement, is a franchisee allowed to operate a fitness business that is franchised by Bft or its affiliates during the term of the agreement?
Bft Franchise · 2025 FDDAnswer from 2025 FDD Document
A. During the Term of this Agreement. Franchisee agrees that neither Franchisee, its principals, owners, or guarantors, nor any immediate family of Franchisee, its principals, owners, or guarantors ("Restricted Parties"), will, directly or indirectly, for themselves or through, on behalf of, or in conjunction with any other person, partnership or corporation own, maintain, engage in, be employed or serve as an officer, director, or principal of, lend money or extend credit to, lease/sublease space to, or have any interest in or involvement with any fitness or exercise business (except a business that it operates
pursuant to a franchise agreement with Franchisor or its affiliates), any fitness or exercise marketing or consulting business, any business offering products of a similar nature to those of the Studio, or in any business or entity which franchises, licenses or otherwise grants to others the right to operate such aforementioned businesses (each a "Competing Business"). Franchisee further agrees that, during the Term, the Restricted Parties shall not divert, or attempt to divert, any customer or prospective customer to a Competing Business in any manner.
Source: Item 23 — RECEIPTS (FDD pages 79–265)
What This Means (2025 FDD)
According to Bft's 2025 Franchise Disclosure Document, during the term of the franchise agreement, a franchisee is permitted to operate a fitness or exercise business if it is operated pursuant to a franchise agreement with Bft or its affiliates. However, franchisees and related parties are otherwise restricted from owning, maintaining, engaging in, or being involved with any other fitness or exercise business, fitness or exercise marketing or consulting business, or any business offering similar products to Bft, or any entity that franchises or licenses others to operate such businesses. This non-compete clause applies to the franchisee, their principals, owners, guarantors, and their immediate family members.
This clause ensures that franchisees remain focused on developing their Bft franchise and prevents them from diverting resources or customers to competing businesses. It protects Bft's market position and the integrity of its brand by limiting the franchisee's ability to engage in similar ventures, with the exception of other Bft franchises.
After the franchise term ends, there are further restrictions. For two years, the franchisee and related parties are prohibited from being involved with any business that competes with Bft by offering or granting licenses or franchises, or establishing joint ventures for operating a competing business. This restriction applies to any location where Bft has offered or sold franchises as of the termination date. Additionally, for two years post-term, they cannot be involved with any competing business at the authorized location or within a 10-mile radius of the authorized location or any other Bft studio owned by Bft, its affiliates, or any franchisee.