What agreement must the transferee enter into with Brueggers Bagels to assume the transferor's obligations?
Brueggers_Bagels Franchise · 2025 FDDAnswer from 2025 FDD Document
16.5.4. That the transferee (and if the transferee is a corporation, partnership, or limited liability company, such owners of a beneficial interest in the transferee as we may request) enter into a written assignment, in a form satisfactory to us, assuming and agreeing to discharge all of your obligations under this Agreement; or, at our option, enter into our then current form of Franchise Agreement; and, if the transferor guaranteed your obligations under this Agreement, that the transferee guarantee the performance of all such obligations in writing in a form satisfactory to us;
16.5.8. That the transferee (if an entity, its Operating Partner) and any employees of the transferee who have not previously completed a training program approved by us complete any training programs then in effect for new franchisees, at their expense.
Source: Item 22 — CONTRACTS (FDD page 61)
What This Means (2025 FDD)
According to Brueggers Bagels's 2025 Franchise Disclosure Document, a transferee must enter into a written assignment with Brueggers Bagels to assume the transferor's obligations under the existing Franchise Agreement. This assignment must be in a form satisfactory to Brueggers Bagels. Alternatively, at Brueggers Bagels's option, the transferee can enter into the then-current form of the Franchise Agreement. If the transferor had guaranteed the obligations under the original agreement, the transferee must also provide a written guarantee of performance in a form satisfactory to Brueggers Bagels.
This requirement ensures that the new franchisee is legally bound to uphold all the responsibilities and duties outlined in the original Franchise Agreement. By signing a written assignment or a new franchise agreement, the transferee agrees to step into the shoes of the previous franchisee and adhere to all terms and conditions set forth by Brueggers Bagels. This protects Brueggers Bagels's interests and maintains consistency across its franchise network.
For a prospective Brueggers Bagels franchisee, this means understanding that if they plan to sell their franchise, the buyer will need to meet Brueggers Bagels's standards and formally agree to take on all existing obligations. This could involve signing a document that essentially adopts the original agreement or, potentially, negotiating and signing a brand new franchise agreement with terms that reflect Brueggers Bagels's current standards. The transferee may also need to complete training programs then in effect for new franchisees, at their expense. The transferee (if an entity, its Operating Partner) and any employees of the transferee who have not previously completed a training program approved by Brueggers Bagels must complete these programs.
It is important for both the transferor and the transferee to fully understand these requirements to ensure a smooth transfer process. The transferor needs to ensure the potential buyer is aware of these obligations, and the transferee needs to be prepared to meet Brueggers Bagels's criteria and legal requirements. This process is typical in franchising, as franchisors want to maintain control over who operates their branded businesses and ensure consistent quality and standards.