If a B Bops developer is an individual, can they transfer the development rights to a partnership?
B_Bops Franchise · 2025 FDDAnswer from 2025 FDD Document
If Developer is an individual and desires to transfer the development rights to a partnership, corporation or limited liability company, Company will not unreasonably withhold its consent to such transfer upon satisfaction of the following conditions: (i) such entity shall comply with each of the requirements specified in Section 14 hereof pertaining to ownership of the development rights by an entity; (ii) Developer shall be the owner of a majority of the equity and voting securities or interests issued by such entity; (iii) Developer shall be the principal executive of such entity; (iv) all accrued money obligations of Developer to Company shall be satisfied prior to the transfer and Developer shall otherwise be in full compliance with the terms of this Agreement and all Unit Franchise Agreements between the parties; and (v) the entity agrees, in writing satisfactory to Company, to assume all Developer's obligations hereunder.
Any assignment to an entity as provided herein shall not release Developer from any obligations imposed by this Agreement and Developer shall remain jointly and severally liable for all such obligations.
Source: Item 23 — RECEIPTS (FDD pages 53–145)
What This Means (2025 FDD)
According to B Bops's 2025 Franchise Disclosure Document, if a developer is an individual, they can transfer their development rights to a partnership, corporation, or limited liability company. However, B Bops will not unreasonably withhold consent to such a transfer if certain conditions are met.
First, the entity must meet the requirements outlined in Section 14 regarding ownership of development rights by an entity. Second, the original developer must own a majority of the equity and voting securities or interests issued by the new entity and be its principal executive. Third, all outstanding financial obligations of the developer to B Bops must be settled, and the developer must be in full compliance with the terms of the Development Agreement and any Unit Franchise Agreements. Finally, the new entity must agree in writing, in a form satisfactory to B Bops, to assume all of the developer's obligations under the original agreement.
Even if the transfer is approved, the original individual developer is not released from their obligations and remains jointly and severally liable for all such obligations. This means that B Bops retains recourse to the original developer even after the transfer to the new entity. This provision ensures that B Bops maintains a level of security and commitment to the development agreement.