Back Yard Burgers today announced that the company and YUM! Brands have terminated discussions on a future multi-brand relationship between the two companies.

Under the terms of a development agreement entered into with YUM! in January 2002, Back Yard granted YUM! the right to use Back Yard Burgers’ trademarks in connection with the establishment and operation of up to ten Back Yard Burgers outlets as part of multi-brand units with Taco Bell, Pizza Hut, and/or KFC operations. The agreement also granted YUM! an option to co-brand up to 500 additional Back Yard Burgers restaurants.

While YUM! did not exercise its option, according to a statement issued by Back Yard Burgers, BYB and YUM! were in discussions to give YUM! the right to license and sublicense the Back Yard Burgers concept and trademarks in connection with the establishment and operation of up to 500 stand-alone and multi-brand outlets. Today the company and YUM! agreed to terminate those discussions.

According to Back Yard Burgers, YUM! has advised it that YUM!’s decision to terminate future development with the company is a result of YUM!’s decision to focus on multi-brand development of its existing brands. Currently, the company has nine co-branded Back Yard Burgers outlets with Taco Bell.

Commenting on the development, Back Yard Burgers chief Lattie Michael said, “While we are disappointed with today’s developments, we are optimistic about the future of the segment of the quick-serve restaurant industry that seeks to provide premium food and service. We will continue to focus on our principal growth strategy of setting our restaurants apart from other fast-food competition.”