Does the Brueggers Bagels Franchise Disclosure Document contain all the provisions related to renewal, termination, transfer and dispute resolution?
Brueggers_Bagels Franchise · 2025 FDDAnswer from 2025 FDD Document
[Item 17: RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION]
ITEM 17 RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION
THE FRANCHISE RELATIONSHIP
This table lists certain important provisions of the franchise and related agreements. You should read these provisions in the agreements attached to this disclosure document.
[Item 17: RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION]
DEVELOPMENT AGREEMENT
| Provision | Section in Development Agreement | Summary |
|---|---|---|
| a. Length of the | Section 2 | Term expires on the last deadline |
| franchise term | specified in your Development Schedule. | |
| b. Renewal or | Not applicable | Not applicable |
| extension of the | ||
| term | ||
| c. Requirements for | Not applicable | Not applicable |
| you to renew or | ||
| extend | ||
| d. Termination by | Not applicable | Not applicable. You may terminate under |
| you | any grounds permitted by law. | |
| e. Termination by | Not applicable | Not applicable |
| BFC without | ||
| cause | ||
| f. Termination by | Section 9 | See g. and h. below. |
| BFC with cause | ||
| Provision | Section in Development Agreement | Summary |
| g. “Cause” defined – defaults which can be cured | Section 9.5 | You have 30 days to cure defaults. In addition, your default under any other agreement that you or an affiliate has with us or our affiliates will constitute a default, subject to any applicable provisions for notice and cure set forth in the other agreement. |
| h. “Cause” defined – non-curable defaults | Section 1.3 and 9.2 | Non-curable defaults include: failure to develop the minimum number of Bakeries required; termination of any other agreement with us or our affiliates; unapproved transfer; and repeated defaults, even if cured. |
| i. Your obligations | Section 10 | See r. below |
| on termination/ | ||
| non-renewal | ||
| j. Assignment of | Section 8.1 | No restriction on our right to assign. |
| contract by BFC | ||
| k. “Transfer” by you – definition | Section 8.2 | Restrictions apply to any transfer of any direct or indirect interest in the Development Agreement or in the Developer (if a corporation or other entity). |
| l. BFC’s approval | Section 8.2 | We have the right to approve all transfers. |
| of transfer by | ||
| you | ||
| m. Conditions for BFC’s approval of transfer | Section 8.5 | We can impose any reasonable conditions, including: New developer qualifies; accrued fees paid; no default exists; transfer fee paid; assignment agreement approved; you sign release; training arranged; no adverse effect from price and terms. |
| n. BFC’s right of | Section 8.4 | We have the right to match any offer. |
| first refusal to | ||
| acquire your | ||
| business | ||
| o. BFC’s option to | Not applicable | Not applicable. |
| purchase your | ||
| business | ||
| p. Your death or | Section 8.6 | Franchise must be assigned by estate to |
| disability | approved party within 1 year. |
[Item 17: RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION]
| Provision | Section in Franchise Agreement or License Agreement | Summary |
|---|---|---|
| a. Length of the franchise term | Section 3.1 of the Franchise Agreement; Section 2.1 of the License Agreement; Paragraph 2 of Franchise Agreement Addendum | The term under the Franchise Agreement is the earlier of 10 years from the date the Bakery opens, or 11 years from the effective date of the agreement; the term under the License Agreement is five years from the effective date of the agreement, and 10 years for all airport locations. |
| b. Renewal or extension of the term | Section 3.2 of the Franchise Agreement; Section 2.2 of the License Agreement | Provided we are still franchising and have not made a decision to withdraw from the geographic market of the Bakery, and if you are in good standing, you can request a successor franchise agreement for one additional 10-year term. Under the License Agreement: two additional five year terms, and one additional 10-year term for airport locations. |
| c. Requirements for you to renew or extend | Section 3.2 of the Franchise Agreement; Section 2.2 of the License Agreement | Written notice, sign successor agreement, remodel, sign general release, and pay one-half of the then-current franchise fee. The Successor Franchise Agreement may contain terms that are materially different from your expiring Franchise Agreement, such as different fee requirements. |
| d. Termination by | Franchise Agreement: Not | Not applicable (subject to applicable state |
| you | applicable | law) |
| License Agreement: Section 10.2(e) | If you are in compliance with the agreement and upon 60 days’ notice to us the lease or concession agreement with your host facility is terminated, expires or is not renewed (subject to applicable state law). | |
| e. Termination by | Not applicable | Not applicable |
| BFC without | ||
| cause | ||
| Provision | Section in Franchise Agreement or License Agreement | Summary |
| t. Integration / merger clause | Section 25 of the Franchise Agreement; Section 12.1 of the License Agreement | Only the terms of the Franchise Agreement are binding (subject to state law); the parties may not enforce any other promises. However, this clause will not be treated as a disclaimer of our representations in this disclosure document. |
| u. Dispute resolution by arbitration | Section 28.3 of the Franchise Agreement; Section 14.8 of the License Agreement | Before bringing an action in court, the parties must first submit the dispute to non-binding mediation (except for injunctive relief) in Colorado (subject to applicable state law). |
| v. Choice of forum | Section 28.2 of the Franchise Agreement; Section 14.7 of the License Agreement | Subject to state law, lawsuits must be filed in the jurisdiction where we have our principal place of business. As of the date of this disclosure document, our principal place of business is in Denver, Colorado. |
| w. Choice of law | Section 28.1 of the Franchise Agreement; Section 14.6 of the License Agreement | Subject to state law, the law of the state in which we have our principal place of business. As of the date of this disclosure document, our principal place of business is in Denver, Colorado. |
| Provision | Section in Development Agreement | Summary |
| q. Non-competition | Section 11.1 | No involvement in Competing Business. |
| covenants during | ||
| the term of the | ||
| franchise | ||
| r. Non-competition covenants after the franchise is terminated or expires | Section 11.2 | No involvement with Competing Business for 1 year within the Development Area or within 5 miles of any Bakery. |
| s. Modification of | Section 17 | Modifications must be agreed in writing. |
| the agreement | ||
| t. Integration / merger clause | Section 17 | Only the terms of the Development Agreement are binding (subject to state law); the parties may not enforce any other promises. However, this clause will not be treated as a disclaimer of our representations in this disclosure document. |
| u. Dispute resolution by arbitration | Section 20.3 | Before bringing an action in court, the parties must first submit the dispute to non-binding mediation (except for injunctive relief) in Colorado (subject to applicable state law).as req |
| v. Choice of forum | Section 20.2 | Subject to state law, litigation must be filed where we have our principal place of business. As of the date of this disclosure document, our principal place of business is in Denver, Colorado. |
| w. Choice of Law | Section 20.1 | Subject to state law, the law of the state in which we have our principal place of business. As of the date of this disclosure document, our principal place of business is in Denver, Colorado. |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 49–54)
What This Means (2025 FDD)
According to Brueggers Bagels's 2025 Franchise Disclosure Document, Item 17 provides details on the provisions related to renewal, termination, transfer, and dispute resolution, as they appear in the franchise and related agreements. The document specifically advises prospective franchisees to carefully review these provisions within the agreements attached to the disclosure document. This suggests that while Item 17 summarizes key aspects, the complete understanding requires a thorough reading of the actual agreements.
The FDD outlines key provisions within the Franchise Agreement, License Agreement, and Development Agreement. For instance, the length of the franchise term, conditions for renewal, termination clauses, transfer conditions, and dispute resolution mechanisms are detailed with references to specific sections of these agreements. For the Franchise Agreement, the term is the earlier of 10 years from opening or 11 years from the agreement date. For the License Agreement, the term is five years, except for airport locations which have a 10-year term.
Regarding dispute resolution, the Brueggers Bagels FDD states that before initiating a lawsuit, parties must first engage in non-binding mediation in Colorado, unless injunctive relief is sought. Litigation must be filed where Brueggers Bagels has its principal place of business, which is Denver, Colorado, and is subject to state law. The FDD also addresses non-competition covenants, both during the franchise term and after termination or expiration, restricting involvement in competing businesses.
In summary, while the Brueggers Bagels FDD offers a summary of these critical provisions, franchisees must consult the full text of the Franchise Agreement, License Agreement, and Development Agreement for a comprehensive understanding of their rights and obligations regarding renewal, termination, transfer, and dispute resolution.