How can the B Bops Development Agreement be terminated early?
B_Bops Franchise · 2025 FDDAnswer from 2025 FDD Document
- B. Upon occurrence of any of the events set forth above, Company may, without prejudice to any other rights or remedies contained in this Agreement or provided by law or equity, terminate this Agreement by notice to Developer. Such termination shall be effective immediately upon receipt of written notice by Developer if the default is an event specified in paragraphs (1) through (6) above, to which no right of cure exists. Termination shall be effective thirty (30) days after receipt of written notice by Developer if the default is an event specified in paragraph (7) above and such default is not cured to Company's satisfaction within 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.
Source: Item 23 — RECEIPTS (FDD pages 53–145)
What This Means (2025 FDD)
According to B Bops's 2025 Franchise Disclosure Document, the company can terminate the Development Agreement early by providing written notice to the developer upon the occurrence of certain events. If the default event falls within paragraphs (1) through (6), the termination is effective immediately upon the developer's receipt of the notice, and there is no opportunity to cure the default. However, if the default event is specified in paragraph (7), the termination becomes effective thirty days after the developer receives the written notice, provided the default is not cured to B Bops's satisfaction within that 30-day period.
Upon termination or expiration of the Development Agreement, the developer's rights to develop further sites become void, and they must cease any attempts to select or develop new locations unless a Unit Franchise Agreement has already been executed. The termination does not affect the developer's rights to operate existing units under already-executed Unit Franchise Agreements, as long as those agreements remain in effect.
B Bops retains the balance of the development fee that has not been applied to initial franchise fees before the termination or expiration. Additionally, B Bops has the right to establish or license others to establish B Bops Restaurants within the trade area, except as limited by any existing Unit Franchise Agreements with the developer. This means that while the developer loses the right to develop new locations, B Bops can continue to expand in the area, potentially with other franchisees, after the Development Agreement is terminated.