For a Big Apple Bagels franchise in Virginia, what is the condition for the refund of the initial franchise fee?
Big_Apple_Bagels Franchise · 2025 FDDAnswer from 2025 FDD Document
This Addendum is to a BAGELS Franchise Agreement dated , 20 between BAB Systems, Inc. and (Franchisee) to amend said Agreement as follows: 1. Paragraph 16.a.x. of the BAGELS Franchise Agreement on Termination for Failure to Complete Training is amended to read in its entirety as follows: Successful Completion of Training. The grant of the franchise herein is conditioned upon successful completion of the sales/operations seminar and technical training seminar by Franchisee (or Franchisee's individual owner if Franchisee is a corporation, partnership, or other entity.) If during the course of the training programs or within fifteen (15) days thereafter Franchisor concludes that Franchisee has not successfully completed the sales/operations seminar and technical training seminar, may, in its sole discretion and judgment, cancel this Agreement and all rights hereunder, where permitted by applicable law, by giving notice to Franchisee and tendering to Franchisee a refund of its initial franchise fee less an amount to cover the reasonable expenses incurred by Franchisor in connection with training Franchisee. Franchisee agrees that such refund shall be the full extent of Franchisor's liability and responsibility in the event of such cancellation, and Franchisee and its owners shall execute a general release, in a form satisfactory to Franchisor, of any and all claims against Franchisor and its affiliates, officers, directors, employees and agents. Upon cancellation of this Agreement, Franchisee shall return to Franchisor all materials, manuals, information and all other items that Franchisee received from Franchisor, including all copies thereof and notes thereon which Franchisee may have or control. Franchisee further agrees to maintain strictly the confidentiality of all information received relating to the BAB System and not to use in the operation of a food service or similar business, any trade secrets or confidential information obtained from Franchisor in the course of the training program or otherwise. In witness whereof, each of the undersigned hereby acknowledges having read this Addendum, understands and consents to be bound by all of its terms, and agrees it shall become effective the day of, 20 BAB SYSTEMS, INC.
Source: Item 23 — RECEIPTS (FDD pages 87–319)
What This Means (2025 FDD)
According to Big Apple Bagels' 2025 Franchise Disclosure Document, specifically Exhibit R which is an addendum for the Commonwealth of Virginia, the initial franchise fee may be refundable under certain conditions related to training. The addendum amends paragraph 16.a.x of the franchise agreement, stating that the grant of the franchise is dependent on the franchisee successfully completing the sales/operations seminar and technical training seminar.
If Big Apple Bagels concludes within fifteen days after the training programs that the franchisee has not successfully completed the required seminars, Big Apple Bagels has the discretion to cancel the agreement. In such a case, where permitted by applicable law, Big Apple Bagels will provide the franchisee with a refund of the initial franchise fee. However, this refund will be less an amount to cover the reasonable expenses Big Apple Bagels incurred in connection with training the franchisee.
The addendum stipulates that the refund of the initial franchise fee, less training expenses, represents the full extent of Big Apple Bagels' liability in the event of cancellation due to unsuccessful training. Furthermore, the franchisee and their owners must execute a general release of all claims against Big Apple Bagels. Upon cancellation, the franchisee is required to return all materials received from Big Apple Bagels and maintain the confidentiality of the information.