Does B Bops have to provide a reason if they withhold consent for a transfer of development rights?
B_Bops Franchise · 2025 FDDAnswer from 2025 FDD Document
any third person. Company shall not unreasonably withhold its consent to any transfer when requested, provided that such transfer complies with the following requirements that may be applicable to the particular type of transfer:
- A. Transfer to Successor Entity. If Franchisee is an individual and desires to transfer the Franchise 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 20 hereof pertaining to ownership of the Franchise by a an entity; (ii) Franchisee shall be the owner of a majority of the equity and voting securities or interests issued by such entity; (iii) Franchisee shall be the principal executive of such entity; (iv) all accrued money obligations of Franchisee to Company shall be satisfied prior to the transfer and Franchisee shall otherwise be in full compliance with the terms of this Agreement; and (v) the entity agrees,
in writing satisfactory to Company, to assume all Franchisee's obligations hereunder. Any assignment to an entity as provided herein shall not release Franchisee from any obligations imposed by this Agreement and Franchisee shall remain liable for all such obligations.
- B. Death or Disability of Franchisee. In the event of death or permanent mental or physical disability of Franchisee, or any partner, shareholder or member owning a controlling interest in Franchisee, the legal representative of Franchisee, or such partner, shareholder or member thereof, together with all surviving partners, shareholders or members, if any, jointly, shall, within six (6) months of such event apply in writing for the right to transfer the Franchise, or the controlling ownership interest of the deceased or disabled partner, shareholder or member in Franchisee, to such person or persons as the legal representative may specify.
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 of development rights. This applies to transfers to a successor entity, in the event of death or disability of the developer, or other transfers not falling within those specific scopes.
For transfers to a successor entity, B Bops will not unreasonably withhold consent if the entity meets certain conditions. These conditions include complying with ownership requirements, the developer owning a majority of the equity and voting securities, the developer being the principal executive, all accrued money obligations being satisfied, and the entity agreeing to assume all of the developer's obligations.
In the event of death or disability, B Bops will not unreasonably withhold consent to transfer the development rights, provided the transfer complies with conditions in Section 13(C) of the agreement. However, payment of the transfer fee is not required, and the legal representative does not need to comply with B Bops' right of first refusal if the transfer is to a member of the immediate family. If the legal representative and surviving partners fail to comply or propose an unacceptable transferee, the agreement may be terminated.
For other transfers, B Bops will not unreasonably withhold consent, but may require certain conditions to be satisfied. These conditions include the transferee being of good character and having the financial capacity, the transferee entering into a written assignment, the developer executing a general release of claims, the developer executing a non-disclosure and non-competition agreement, and the developer fully paying all obligations and a $3,000 transfer fee. The FDD states that where the consent or approval of B Bops is required, such consent or approval shall not unreasonably be withheld.