Does the Brueggers Bagels franchise agreement confer any rights or remedies to third parties?
Brueggers_Bagels Franchise · 2025 FDDAnswer from 2025 FDD Document
In order to induce Bruegger's Franchise Corporation ("Franchisor") to sign the Bruegger's Bagels Franchise Agreement between Franchisor and ("Franchisee"), dated , 202 (the "Agreement"), each of the undersigned parties, jointly and severally, hereby unconditionally guarantee to Franchisor and its successors and assigns that all of Franchisee's obligations (monetary and otherwise) under the Agreement as well as any other contract between Franchisee and Franchisor (and/or Franchisor's affiliates) will be punctually paid and performed.
Source: Item 22 — CONTRACTS (FDD page 61)
What This Means (2025 FDD)
According to the 2025 Brueggers Bagels Franchise Disclosure Document, the franchise agreement includes a guarantee, indemnification, and acknowledgment section that impacts third parties. Specifically, individuals or entities may be required to unconditionally guarantee the franchisee's obligations to Brueggers Bagels. This means that these guarantors become responsible for the franchisee's financial and performance obligations under the agreement.
This guarantee extends to all monetary and non-monetary obligations of the franchisee, ensuring that Brueggers Bagels has recourse beyond the franchisee itself. This is a common practice in franchising, especially when the franchisee is a corporate entity with limited assets. The franchisor seeks additional security from the individuals or parent companies behind the franchisee.
Prospective Brueggers Bagels franchisees should carefully review the guarantee requirements and ensure that any individuals or entities providing a guarantee understand the full extent of their obligations. They should also seek legal counsel to fully understand the implications of providing such a guarantee, as it could expose them to significant financial risk if the franchise fails to meet its obligations.