What is the effect of termination of the B Bops Development Agreement on existing Unit Franchise Agreements?
B_Bops Franchise · 2025 FDDAnswer from 2025 FDD Document
- 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 termination or expiration of the Development Agreement does not automatically affect the rights of the developer to operate existing B Bops units. The developer can continue to operate any unit under the terms of a Unit Franchise Agreement that they have already entered into with B Bops. This right continues unless the Unit Franchise Agreement is separately terminated according to its own terms.
However, upon termination or expiration of the Development Agreement, the developer's rights to select or develop new sites cease immediately. B Bops retains the right to establish, or license others to establish, B Bops Restaurants in the trade area, except as limited by the terms of any existing Unit Franchise Agreements the developer has with B Bops.
This means that while a developer loses the ability to expand their B Bops business under the Development Agreement if it is terminated, their existing B Bops restaurants operating under individual Unit Franchise Agreements are not directly impacted. The franchisee can continue to operate those restaurants as long as they comply with the terms of their Unit Franchise Agreements.