What is B Bops prohibited from doing with third parties before informing the applicant of their decision?
B_Bops Franchise · 2025 FDDAnswer from 2025 FDD Document
Prior to informing Applicant of Company's decision of whether the Rights will be granted, Company agrees that it shall not negotiate with any third party regarding the potential purchase of a B-Bop's Restaurant in the Trade Area.
For purposes of this Section 6, the term "negotiate" shall mean the execution of an Application Agreement with any third party, the acceptance of a deposit from any third party or the providing of any assistance or information identified in this Agreement to any third party.
Nothing in this Section 6 shall prohibit Company from providing an information package or Franchise Offering Circular to any third party interested in purchasing a B-Bop's Restaurant in the Trade Area with any third party for the purchase of a B-Bop's Restaurant in the Trade Area.
Upon termination of this Agreement by either party, Company shall be entitled to negotiate.
Source: Item 23 — RECEIPTS (FDD pages 53–145)
What This Means (2025 FDD)
According to B Bops' 2025 Franchise Disclosure Document, prior to informing an applicant whether they will be granted franchise rights, B Bops is prohibited from negotiating with any third party regarding the potential purchase of a B Bops Restaurant in the Trade Area.
For the purposes of this restriction, "negotiate" specifically includes executing an Application Agreement with a third party, accepting a deposit from them, or providing any assistance or information that is typically provided to an applicant, as outlined in the agreement. This protects the applicant's potential territory while B Bops is considering their application.
However, this restriction does not prevent B Bops from providing a general information package or Franchise Offering Circular to other interested parties. Furthermore, once the agreement with the applicant is terminated by either party, B Bops is free to negotiate with other parties.
This clause ensures that B Bops gives each applicant fair consideration without actively pursuing other candidates for the same territory until a decision has been communicated. This is a fairly standard practice in franchising to maintain good faith during the application process.