What obligations does a Ben Jerrys franchisee have upon termination or non-renewal of the Development Agreement, as described in Section 6.4?
Ben_Jerrys Franchise · 2025 FDDAnswer from 2025 FDD Document
| Provision | Section in Development Agreement | Summary | |
|---|---|---|---|
| a. Term of the | Exhibit A | Last date in Development | |
| agreement | Schedule | ||
| b. Renewal or | Not applicable | Not applicable | |
| extension of the | |||
| term | |||
| c. Requirements for | Not applicable | Not applicable | |
| you to renew or | |||
| extend | |||
| d. Termination by | Not applicable | Not applicable | |
| you | |||
| e. Termination by | Not applicable | Not applicable | |
| us without cause | |||
| f. | Termination by | § 6 | We can terminate if you default. |
| us with cause | |||
| g. "Cause" defined - curable defaults | § 6.3 | All other defaults not specified in §§ 6.1 and 6.2 of Development Agreement. | |
| h. "Cause" defined - non-curable defaults | §§ 6.1 and 6.2 | Bankruptcy; failure to meet requirements of Development Schedule; failure to comply with any individual Franchise Agreement for a Scoop Shop operated by you or a person or entity affiliated with you. | |
| i. | Your obligations on termination/ nonrenewal | § 6.4 | Cease establishing or operating Scoop Shops under the System for which Franchise Agreements have not been signed at the time of termination and compliance with covenants. |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER, AND DISPUTE RESOLUTION (FDD pages 68–76)
What This Means (2025 FDD)
According to Ben Jerrys's 2025 Franchise Disclosure Document, Section 6.4 of the Development Agreement outlines the franchisee's obligations upon termination or non-renewal. Specifically, the franchisee must cease establishing or operating Scoop Shops under the Ben Jerrys system for which Franchise Agreements have not been signed at the time of termination. Additionally, the franchisee must comply with all covenants outlined in the agreement.
In practical terms, this means that if a Development Agreement is terminated or not renewed, the franchisee cannot continue to open new Ben Jerrys locations that were planned but not yet under a fully executed Franchise Agreement. The franchisee is held to the promises and restrictions outlined in the Development Agreement, which may include non-compete clauses or confidentiality agreements.
This obligation is fairly standard in franchising. It protects Ben Jerrys from a former franchisee using the franchisor's proprietary information or development plans to compete against the system after the agreement ends. Prospective franchisees should carefully review the covenants within the Development Agreement to understand the full scope of these post-termination obligations and how they might impact future business ventures.