What agreement must each owner, director, or officer of a Brueggers Bagels franchisee execute?
Brueggers_Bagels Franchise · 2025 FDDAnswer from 2025 FDD Document
20.4. Personal Obligations of Owners, Officers, Directors, Management Personnel and Spouses. Each person who is or becomes an owner, director or officer of Franchisee must execute a Guaranty in the form we prescribe, undertaking to be bound jointly and severally by the terms of this Agreement including but not limited to those provisions in Section 19 above. The current form of Guaranty is attached to this Agreement as Exhibit B. Each person who is, or
becomes, an owner or executive officer of Franchisee must also execute a Confidentiality and Non-competition Agreement in a form we prescribe, the current form of which is attached to this Agreement as Exhibit C. If you are a publicly-held entity, the requirements in this Section will not apply to ownership by you of less than five percent (5%) beneficial interest. In addition, at our request, if the Guarantor resides in a community property state, the Guarantor will cause his or her spouse, if any, to execute a Guaranty and you must also obtain signed Confidentiality and Non-competition Agreements referred to above. Confidentiality and Non-competition Agreements must also be obtained from any manager who has received or will receive training from us.
Source: Item 22 — CONTRACTS (FDD page 61)
What This Means (2025 FDD)
According to the 2025 Brueggers Bagels Franchise Disclosure Document, each person who is or becomes an owner, director, or officer of a Brueggers Bagels franchise must execute a Guaranty. This Guaranty is in a form prescribed by Brueggers Bagels and ensures that these individuals are jointly and severally bound by the terms of the Franchise Agreement, including the provisions outlined in Section 19 of the agreement. The current form of Guaranty is attached to the Franchise Agreement as Exhibit B.
In addition to the Guaranty, each person who is or becomes an owner or executive officer of the Brueggers Bagels franchisee must also execute a Confidentiality and Non-competition Agreement, also in a form prescribed by Brueggers Bagels. The current form of this agreement is attached as Exhibit C to the Franchise Agreement. These agreements ensure the protection of Brueggers Bagels' confidential information and prevent unfair competition.
Furthermore, if a Guarantor resides in a community property state, Brueggers Bagels may require their spouse to execute a Guaranty and a Confidentiality and Non-competition Agreement. Confidentiality and Non-competition Agreements must also be obtained from any manager who has received or will receive training from Brueggers Bagels. These requirements do not apply to ownership of less than 5% beneficial interest in Brueggers Bagels if the franchisee is a publicly-held entity.
These requirements ensure that individuals with significant control or ownership in a Brueggers Bagels franchise are personally responsible for upholding the franchise agreement and protecting the brand's interests. Prospective franchisees should carefully review Exhibits B and C to understand the full scope of these obligations and consult with legal counsel to assess their implications.