Why does Brueggers Bagels require consent for franchisee transfers?
Brueggers_Bagels Franchise · 2025 FDDAnswer from 2025 FDD Document
16.5.1. That all of your accrued monetary obligations and all other outstanding obligations to us and our affiliates have been satisfied;
16.5.2. That you are not in default of any provision of this Agreement, any amendment hereof or successor hereto, or any other agreement between you and us or our affiliates;
16.5.3. That the transferor executes a general release, in a form satisfactory to us, of any and all claims against us, our affiliates and their respective past, present, and future officers, directors, shareholders, and employees, in their corporate and individual capacities;
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;
16.5.5. If the transferee is an existing Bruegger's developer or franchisee, that the transferee is not in default under its agreements with us and has a good record of customer service and compliance with our operating standards;
16.5.6. That the transferee, whether or not an existing Bruegger's developer or franchisee, demonstrates to our satisfaction that he or she meets (or, if the transferee is a business entity, that its owners and management team meet) our educational, managerial, and business standards; possesses a good moral character, business reputation, and credit rating; has the aptitude and ability to conduct the business contemplated hereunder (as may be evidenced by prior related business experience or otherwise); and has adequate financial resources and capital to fulfill your obligations hereunder in a timely manner; and
16.5.7. That the transferor pays a transfer fee equal to 50% of the initial franchise fee we are then charging for new Bakery franchises.
Source: Item 22 — CONTRACTS (FDD page 61)
What This Means (2025 FDD)
According to Brueggers Bagels' 2025 Franchise Disclosure Document, the franchisor requires consent for franchisee transfers to ensure that the brand's standards are maintained and that any new franchisee meets their criteria. Brueggers Bagels needs to confirm several conditions are met before a transfer is approved. These conditions include ensuring all outstanding obligations to Brueggers Bagels are satisfied, the franchisee is not in default of any agreements, and the franchisee provides a general release of claims against Brueggers Bagels.
Brueggers Bagels also wants to ensure the transferee is suitable. The transferee must enter into a written agreement assuming all obligations under the Franchise Agreement or enter into Brueggers Bagels' current form of Franchise Agreement. If the transferee is an existing Brueggers Bagels developer or franchisee, they must not be in default under their agreements and must have a good record of customer service and compliance with operating standards. The transferee, whether new or existing, must demonstrate that they meet Brueggers Bagels' educational, managerial, and business standards, possess good moral character, business reputation, and credit rating, have the aptitude and ability to conduct the business, and have adequate financial resources.
Finally, Brueggers Bagels requires a transfer fee to be paid. The transfer fee is equal to 50% of the initial franchise fee that Brueggers Bagels is then charging for new Bakery franchises. These stipulations allow Brueggers Bagels to maintain control over who operates their franchises and to protect the brand's reputation and standards.