What is a B Bops developer prohibited from doing after termination or expiration of the Development Agreement?
B_Bops Franchise · 2025 FDDAnswer from 2025 FDD Document
thin such period.
- C. Upon termination or expiration of this Agreement, the development rights granted hereunder shall become null and void and Developer shall immediately cease any further attempts to select or develop sites on which to construct Units. Developer shall have no right to establish or operate any Unit for which a Unit Franchise Agreement has not been executed by Company prior to termination or expiration hereof. Termination or expiration of this Agreement shall not affect the rights of Developer to operate any Unit in accordance with the terms of any Unit Franchise Agreement which Developer has entered into with Company, until and unless such Unit Franchise Agreement is terminated in accordance with its terms. Developer acknowledges that upon termination or expiration hereof, Company shall be entitled to: (i) retain the balance of the development fee not applied towards initial franchise fees prior to termination or expiration hereof; and (ii) establish, or license others to establish, B-Bop's Restaurants in the Trade Area, except to the extent limited by the terms of any Unit Franchise Agreement executed by Company and Developer.
12. COVENANT NOT TO COMPETE.
- A. Developer hereby agrees that during the term of this Agreement, Developer, its directors, officers, shareholders, partners, members, principals or agents will not, directly or indirectly, enter into or engage in any business the same as or substantially similar to a B-Bop's Restaurant, except for any Unit owned and operated by Developer pursuant to a Unit Franchise Agreement entered into between the parties hereto.
- B. Developer hereby agrees that for a period of two (2) years immediately following the termination or expiration of this Agreement, Developer, its directors, officers, shareholders, partners, members, principals or agents will not, directly or indirectly, enter into or engage in any business the same as or substantially similar to a B-Bop's Restaurant operating at any location within the Trade Area or within a twenty (20) mile radius of any other B-Bop's Restaurant then in operation or under construction, whether owned and operated by Company, any affiliate of Company or by a franchisee under license granted by Company, except that Developer shall be entitled to continue to own and operate any Unit pursuant to a Unit Franchise Agreement entered into between the parties hereto.
- C.
Source: Item 23 — RECEIPTS (FDD pages 53–145)
What This Means (2025 FDD)
According to B Bops' 2025 Franchise Disclosure Document, a developer faces specific restrictions following the termination or expiration of their Development Agreement. The development rights previously granted become void, and the developer must immediately stop attempting to select or develop new sites for B Bops restaurants. They cannot establish or operate any B Bops unit if a Unit Franchise Agreement was not executed by B Bops before the termination or expiration date. However, the termination of the Development Agreement does not affect the developer's right to continue operating any B Bops unit for which a Unit Franchise Agreement is already in place, unless that specific Unit Franchise Agreement is separately terminated.
Furthermore, for two years after the Development Agreement ends, the developer is restricted from engaging in any business that is the same as or substantially similar to a B Bops restaurant. This restriction applies within the Trade Area defined in the agreement and within a 20-mile radius of any existing or under-construction B Bops restaurant. The exception to this is that the developer can continue to operate any B Bops unit they own under a Unit Franchise Agreement. A business is considered "substantially similar" if it prepares and serves any food items that are standard menu items at B Bops.
These post-termination restrictions are typical in franchising to protect the brand and prevent former franchisees or developers from directly competing with the franchise system, potentially using knowledge gained during their time with the brand. Prospective B Bops developers should carefully consider these limitations and how they might impact their future business activities should the Development Agreement end.