Under what condition can a Big Apple Bagels franchisee operate a catering service?
Big_Apple_Bagels Franchise · 2025 FDDAnswer from 2025 FDD Document
b. Restrictions Upon Franchisee's Channels of Distribution. Franchisee is restricted solely to the retail sale of products sold under this Agreement. Franchisee is expressly prohibited from engaging in the wholesale distribution of products under this Agreement, unless Franchisee and Franchisor have entered into a Wholesale Program Addendum. Franchisee is expressly prohibited from engaging in a catering service selling Branded Products under this Agreement, unless Franchisee and Franchisor have entered into a Catering Program Addendum.
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Franchisee is granted the right to sell and deliver on a catered basis Big Apple Bagel, Brewster's, and My Favorite Muffin branded bagels, sandwiches, cream cheese, coffee, and muffins ("Catered Products") produced in the BAGELS Store on a nonexclusive basis outside of the BAGELS Store under the conditions as set forth herein.
The right of Franchisee to participate in this Catering Program is expressly conditioned upon Franchisee being in good standing.
Franchisee explicitly acknowledges and agrees that any delivery of Catered Products is his sole and exclusive responsibility.
Franchisee is to determine whether customers are to pick up Catered Products at the BAGELS Store or Franchisee may deliver Catered Products to customers.
Franchisee is responsible for conforming to all applicable health, sanitation, food handling, and food transportation requirements and the condition of Catered Products delivered by Franchisee to customer or picked up by customers at the BAGELS Store.
At no time should bagels or muffins that are not freshly baked be delivered to or picked up by customers.
Franchisee is strictly prohibited from selling anything other than finished products.
This Catering Program must be operated in strict conformance with provisions of the Franchise Agreement and the Operations Manual.
All catering sales will be subject to Paragraph 8.b. and 10.a. of the Franchise Agreement (pertaining to the royalty fees and Marketing Fund contributions).
Franchisee may solicit or deliver Catered Products only to customers in a Catering Market Area determined as follows: (a) if Franchisee has a protected area under an existing Area Development Agreement, anywhere within that protected area; (b) for areas outside any existing Area Development Agreement, within a Thiessen Polygon drawn around the BAGELS Store, the boundaries of which define the area that is closest to the BAGELS Store relative to all BAGELS Stores, wherever located and whenever developed.
Under no circumstances shall Franchisor be liable to Franchisee for any modification of, restriction under, or termination of Franchisee's participation in the Catering Program.
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- As a condition for Franchisee being given the right to participate in this Catering Program, he must first obtain product liability and delivery vehicle and umbrella insurance coverages in amounts determined by Franchisor as set forth in the Operations Manual.
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- In the event Franchisee's BAGELS Store is sold or assigned, the right to distribute Catered Products under this Addendum is not automatically assignable with the BAGELS Store. Franchisor in its sole discretion may terminate Franchisee's participation in the Catering Program upon assignment. The right to distribute Catered Products under this Program may not be severed from other rights set forth in the Franchise Agreement; when said Franchise Agreement is terminated or expires, this Addendum also terminates or expires.
Source: Item 22 — CONTRACTS (FDD pages 86–87)
What This Means (2025 FDD)
According to Big Apple Bagels' 2025 Franchise Disclosure Document, a franchisee can operate a catering service if they have entered into a Catering Program Addendum with the franchisor. The franchisee is granted the right to sell and deliver Big Apple Bagels, Brewster's, and My Favorite Muffin branded products produced in their store on a catered basis. However, this right is conditional upon the franchisee being in good standing with Big Apple Bagels.
The franchisee bears the sole responsibility for the delivery of catered products, determining whether customers pick up the products at the store or if the franchisee delivers them. They must also conform to all applicable health, sanitation, food handling, and food transportation requirements, ensuring that only freshly baked bagels and muffins are delivered or picked up. The franchisee is prohibited from selling anything other than finished products.
The catering program must be operated in strict accordance with the Franchise Agreement and the Operations Manual. All catering sales are subject to royalty fees and Marketing Fund contributions as outlined in the Franchise Agreement. A franchisee may only solicit or deliver catered products to customers within their designated Catering Market Area, which is determined by either their protected area under an existing Area Development Agreement or a Thiessen Polygon drawn around their store. Furthermore, as a condition to participate in the Catering Program, the franchisee must first obtain product liability and delivery vehicle and umbrella insurance coverages in amounts determined by Big Apple Bagels as set forth in the Operations Manual.
Big Apple Bagels retains the right to modify, restrict, or terminate a franchisee's participation in the Catering Program without liability. The right to distribute catered products is not automatically assignable if the franchisee's store is sold or assigned, and Big Apple Bagels may terminate participation upon assignment. The right to distribute catered products cannot be separated from the Franchise Agreement, meaning that if the Franchise Agreement is terminated or expires, the Catering Program Addendum also terminates or expires.