What is the condition for B Bops and its affiliates to be restricted from developing a defined trade area?
B_Bops Franchise · 2025 FDDAnswer from 2025 FDD Document
Under the multiple-unit arrangement, the Company utilizes the Multiple-Unit Development Agreement attached hereto as Exhibit D (the "Development Agreement") to grant development rights. If the Company approves your application for development rights, you will sign a Development Agreement and be granted the right to establish a specified number of Franchises in a defined trade area in accordance with a development schedule negotiated between you and the Company. So long as you comply with the development schedule (and the Development Agreement otherwise remains in effect), the Company and its affiliates cannot develop the defined trade area through the establishment of Company-owned units or through the sale of Franchises to other persons. Each Franchise established in the trade area will be governed by a separate franchise agreement you must sign, with such franchise agreement to be in the form of the standard franchise agreement being utilized by the Company at the time to grant new Franchises. The multiple-unit arrangement will be used only in larger metropolitan areas that are capable of supporting a number of Franchises. In the event you are a corporation, limited liability company or partnership, your shareholders, members or partners will be required to personally guaranty your obligations under the Development Agreement and each franchise agreement executed with the Company.
Source: Item 1 — THE FRANCHISOR AND ANY PARENTS, PREDECESSORS AND AFFILIATES (FDD pages 9–11)
What This Means (2025 FDD)
According to B Bops's 2025 Franchise Disclosure Document, B Bops and its affiliates face restrictions on developing a defined trade area if a franchisee adheres to the development schedule outlined in a Multiple-Unit Development Agreement. This agreement grants the franchisee the right to establish a specified number of B Bops franchises within that defined area.
This condition is part of B Bops's multiple-unit arrangement, which is offered in larger metropolitan areas capable of supporting several franchises. The Development Agreement, attached as Exhibit D to the FDD, details the terms and development schedule that the franchisee must follow. As long as the franchisee complies with this schedule and the Development Agreement remains in effect, B Bops commits not to develop the trade area themselves, either through company-owned units or by selling franchises to other individuals.
For a prospective franchisee considering a multiple-unit arrangement, this provides a degree of territorial protection, ensuring that B Bops will not directly compete within the agreed-upon area as long as the franchisee meets their development obligations. This arrangement necessitates a separate franchise agreement for each B Bops restaurant established in the trade area, based on the standard franchise agreement in use at the time of granting new franchises. Furthermore, if the franchisee is a corporation, limited liability company, or partnership, the shareholders, members, or partners must personally guarantee the obligations under both the Development Agreement and each individual franchise agreement.