What happens if a Brueggers Bagels franchisee fails to satisfy the Development Schedule?

According to Brueggers Bagels's 2025 Franchise Disclosure Document, if a franchisee fails to open a bakery within the specified time in the Development Schedule, or if the required number of bakeries are not in operation by any deadline in the schedule, Brueggers Bagels has the option to terminate the Development Agreement by providing written notice. This termination right is in addition to any other remedies Brueggers Bagels may have for not meeting the Development Schedule.

This means that a prospective Brueggers Bagels franchisee who signs a Development Agreement commits to opening a certain number of locations within a specific timeframe. Failure to meet these milestones can result in the termination of the agreement, potentially leading to a loss of development rights for the area.

It is important for potential Brueggers Bagels franchisees to carefully review the Development Schedule (Exhibit B) and assess their ability to meet the specified deadlines. Franchisees should also understand that the initial franchise fee for each bakery is $30,000, and a portion of the Development Fee is applied against this fee. Specifically, $10,000 of the Development Fee is applied to the first three bakeries, and $5,000 is applied to subsequent bakeries. All collected amounts are deemed fully earned upon receipt and are non-refundable, so failing to meet the development schedule could result in financial losses in addition to the loss of development rights.