What rights does a B Bops developer retain regarding existing Unit Franchise Agreements after the Development Agreement terminates?
B_Bops Franchise · 2025 FDDAnswer from 2025 FDD Document
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, the termination or expiration of the Development Agreement does not impact a developer's rights to operate existing B Bops units under previously executed Unit Franchise Agreements. Specifically, the developer can continue to operate any B Bops restaurant according to the terms outlined in the Unit Franchise Agreement, even after the Development Agreement ends, unless the Unit Franchise Agreement itself is terminated according to its own terms. This ensures that investments made in established B Bops locations are protected.
However, upon termination or expiration of the Development Agreement, the developer loses the right to select new sites or develop additional B Bops restaurants. The developer also forfeits any unapplied balance of the development fee. B Bops retains the right to establish new restaurants or license others to do so within the trade area, except as limited by the terms of any existing Unit Franchise Agreements with the developer.
This arrangement provides a degree of security for developers who have successfully established B Bops units, allowing them to continue operations without disruption from the end of the Development Agreement. However, it also means that the developer cannot expand further under the Development Agreement and must adhere to the non-compete clauses outlined in the agreement, which restrict involvement in similar businesses within specified areas for a certain period after termination or expiration.