Does Brueggers Bagels retain all amounts paid if the Development Agreement is terminated?
Brueggers_Bagels Franchise · 2025 FDDAnswer from 2025 FDD Document
Promptly pay all sums owing to us and our affiliates. In the event of termination for your default, the sums will include all damages, costs, and expenses incurred by us as a result of the default, including, but not limited to, reasonable attorneys' fees. You will have no right to a refund of all or any part of the Development Fee, regardless of whether you entered into a Franchise Agreement prior to such termination. We will retain all amounts paid to us pursuant to the terms of this Agreement.
Source: Item 22 — CONTRACTS (FDD page 61)
What This Means (2025 FDD)
According to Brueggers Bagels' 2025 Franchise Disclosure Document, if the Development Agreement is terminated due to the franchisee's default, Brueggers Bagels retains all amounts paid. This includes the Development Fee, regardless of whether a Franchise Agreement was entered into before the termination. Brueggers Bagels is entitled to all damages, costs, and expenses incurred as a result of the default, including reasonable attorneys' fees.
This policy means that a prospective Brueggers Bagels franchisee risks losing their entire investment in the Development Agreement if they fail to meet their obligations. The franchisee will not receive any refund of the Development Fee, even if they have not yet opened any Brueggers Bagels locations. This is a significant financial risk that potential franchisees should carefully consider.
In the event of termination for default, the franchisee is also responsible for paying all sums owed to Brueggers Bagels and its affiliates, including damages, costs, and expenses incurred due to the default, such as reasonable attorneys' fees. This further increases the financial burden on the franchisee in the event of a default and termination. Franchisees should be aware of all the conditions that could trigger a default and the potential financial consequences.