What happens if a proposed B Bops transferee does not meet the company's standards for developers?
B_Bops Franchise · 2025 FDDAnswer from 2025 FDD Document
of such transfer.
- C. Other Transfers. Company will not unreasonably withhold its consent to any transfer not falling within the scope of Sections 13(A) or 13(B) above, provided that Company may in its discretion require that one or more of the following conditions be satisfied prior to, or concurrently with, the effective date of such transfer:
- (1) The transferee shall be of good moral character and reputation, have the financial capacity to develop the Units in accordance with the Development Schedule, have business qualifications reasonably acceptance to Company and otherwise meet Company's then current standards for developers. Developer shall provide Company with such information as Company may reasonably require to make such a determination concerning each proposed transferee;
- (2) The transferee shall enter into a written assignment in a form satisfactory to Company, assuming and agreeing to be bound by and discharge all of Developer's obligations imposed by this Agreement, and, if the obligations of Developer were guaranteed by the transferor, the transferee shall execute a guaranty in form and substance acceptable to Company;
- (3) Developer (and such partners, shareholders or members thereof as Company may direct), or the individual partner, shareholder or member thereof proposing to make such transfer, shall execute a general release of all claims against Company and its affiliates and their respective directors, officers, agents and employees;
- (4) Developer (and such partners, shareholders or members thereof as Company may direct), or the individual partner, shareholder or member thereof proposing to make the transfer, shall execute a nondisclosure and noncompetition agreement in favor of Company containing the restrictions set forth in Sections 10 and 12 of this Agreement;
- (5) Developer shall have fully paid and satisfied all of Developer's obligations owing to Company under this Agreement and any Unit Franchise
Agreement between the parties, and shall have fully paid a transfer fee of Three Thousand Dollars ($3,000) to Company for supervisory, administrative, accounting, legal and other expenses incurred by Company in connection with such transfer;
- (6) If transferee is a partnership, corporation or limited liability company, such entity shall comply with each of the requirements specified in Section 14 hereof pertaining to ownership of the development rights by an entity;
- (7) If any Unit Franchise Agreements executed pursuant to this Agreement are to be transferred by Developer, the transferee and Developer shall comply with all terms thereof relating to such transfer; and
- (8) Developer, or the partner, shareholder or member proposing to make such transfer, shall have complied with the right of first refusal provisions set forth in Sec
Source: Item 23 — RECEIPTS (FDD pages 53–145)
What This Means (2025 FDD)
According to B Bops' 2025 Franchise Disclosure Document, B Bops will not unreasonably withhold consent to a transfer if it meets certain conditions. One of these conditions is that the proposed transferee must meet B Bops' current standards for developers. This includes having good moral character and reputation, the financial capacity to develop the Units according to the Development Schedule, and business qualifications reasonably acceptable to B Bops. The developer must provide B Bops with any information reasonably required to make a determination about the proposed transferee.
If the proposed transferee does not meet these standards, B Bops can withhold its consent to the transfer. This means the current developer would not be able to transfer their development rights to the proposed transferee. This protects B Bops by ensuring that any new developers meet their standards for financial capacity, business qualifications, and overall suitability.
In addition to meeting B Bops' standards, the transferee must also enter into a written assignment assuming all of the developer's obligations, execute a general release of all claims against B Bops, execute a non-disclosure and non-competition agreement, and fully pay all outstanding obligations to B Bops, including a $3,000 transfer fee. The transfer must also comply with requirements pertaining to ownership of development rights by an entity and the right of first refusal provisions.
Overall, these transfer conditions ensure that B Bops maintains control over who becomes a developer within their system and that any transfer does not negatively impact the brand or other franchisees. A prospective franchisee should carefully consider these requirements and ensure they can find a qualified transferee if they ever decide to sell their development rights.