What happens to the B Bops development rights upon termination or expiration of the agreement?
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, upon termination or expiration of the Development Agreement, the developer's rights to develop B Bops restaurants become null and void. The developer must immediately stop trying to select or develop sites for new units. The developer cannot establish or operate any B Bops restaurant for which a Unit Franchise Agreement was not executed before the termination or expiration date. However, the termination or expiration of the Development Agreement does not affect the developer's rights to operate existing B Bops restaurants under existing Unit Franchise Agreements, unless those agreements are separately terminated.
B Bops is entitled to retain any remaining balance of the development fee that hasn't been applied to initial franchise fees before the termination or expiration. After termination or expiration, B Bops has the right to establish new restaurants or license others to do so within the Trade Area, except as limited by any existing Unit Franchise Agreements with the developer.
This means that a developer who loses their development rights will not be able to continue expanding the B Bops brand in their designated area but can continue to operate any B Bops restaurants already established under separate franchise agreements. The developer also forfeits any unapplied portion of the development fee, which could be a significant financial loss depending on how far along they were in their development schedule.