Upon what condition are the rights to operate a Black Bear Diner restaurant granted to a developer?

According to Black Bear Diner's 2025 Franchise Disclosure Document, the rights to operate a Black Bear Diner restaurant are granted to a developer upon signing a Franchise Agreement. The Area Development Agreement itself does not grant the right to operate a restaurant or solicit orders.

The document clarifies that under the Area Development Agreement, a developer receives a Development Area with the rights and obligation to develop one or more Black Bear Diner restaurants. The size of this area depends on factors such as the number of restaurants planned, population density, and demographics. A development schedule is established before signing the agreement, outlining when each restaurant must be approved for commencement of operations.

However, failure to meet the development schedule can lead to termination of the development rights and the Area Development Agreement. While the developer is responsible for finding suitable sites, Black Bear Diner retains the right to approve or disapprove these sites based on their criteria. The developer's exclusive rights under the Area Development Agreement terminate upon the earlier of the agreement's expiration or when a Franchise Agreement is signed for the last restaurant to be developed within the Development Area.