What happens if a Brueggers Bagels franchisee files for bankruptcy and it is not opposed?
Brueggers_Bagels Franchise · 2025 FDDAnswer from 2025 FDD Document
- 8.6. Death, Incapacity or Bankruptcy.
If you or any Owner dies, becomes incapacitated, or enters bankruptcy proceedings, that person's executor, administrator, personal representative, or trustee must apply to us in writing within 3 months after the event (death, declaration of incapacity, or filing of a bankruptcy petition) for consent to transfer the person's interest.
The transfer will be subject to the provisions of this Section 8, as applicable.
In addition, if the deceased or incapacitated person is the Operating Partner, we will have the right (but no obligation) to take over operation of the Bakery upon giving notice to the executor, administrator, personal representative, or trustee and to manage the Bakery until the transfer is completed.
If we exercise this right, we can charge a reasonable management fee for our services.
Source: Item 22 — CONTRACTS (FDD page 61)
What This Means (2025 FDD)
According to the 2025 Brueggers Bagels Franchise Disclosure Document, if a franchisee enters bankruptcy proceedings, their executor, administrator, personal representative, or trustee must apply in writing to Brueggers Bagels for consent to transfer the person's interest within 3 months of filing the bankruptcy petition.
The transfer will be subject to the standard transfer provisions outlined in Section 8 of the franchise agreement. If the person who filed for bankruptcy is the Operating Partner, Brueggers Bagels has the right, but not the obligation, to take over operations of the bakery. Brueggers Bagels will provide notice to the executor, administrator, personal representative, or trustee and manage the bakery until the transfer is complete.
If Brueggers Bagels exercises its right to take over operations, it can charge a reasonable management fee for its services. This ensures that even during bankruptcy, the Brueggers Bagels location can continue operating under the brand's standards, although the FDD does not specify what happens if the transfer is not approved.