What right does Brueggers Bagels grant to the developer regarding Bakeries?
Brueggers_Bagels Franchise · 2025 FDDAnswer from 2025 FDD Document
1.5. While this Agreement is in effect, we will not establish Bakeries or franchise others to establish Bakeries within the Development Area, subject to the rights reserved in Sections 1.6 and 1.7 below.
1.6. We and our affiliates retain the rights, despite anything to the contrary in Section 1.5 and regardless of the proximity to or effect on any Bakery that you operate:
1.6.1. To own, acquire, establish, operate and franchise or license others to operate Bakeries located outside of the Development Area;
1.6.2. To own, acquire, establish, operate, and franchise or license others to operate outlets at Non-Traditional Locations under the Bruegger's name or any other name, whether inside or outside of the Development Area. "Non-Traditional Location" means a facility where the primary function is not a Bakery business, such as (but not limited to) a performing arts center, arena, stadium, shopping mall, department store, retail store, wholesale club, grocery store, supermarket, casino, amusement park, fairground, college or university, factory, hospital, penal institution, military base, airport, turnpike, limited access highway rest stop, or other transportation facility;
1.6.3. To develop, manufacture, have manufactured, market, sell and distribute, at retail or wholesale, and license others to manufacture, sell or distribute, packaged food products or any other goods or services under the Bruegger's mark or any other name or mark, through any channel of distribution other than a Bakery, including but not limited to the Internet, supermarkets, specialty food stores, convenience stores, wholesale clubs and retail food stores, anywhere in the world; and
1.6.4. To use the Bruegger's brand in other lines of business besides the operation of restaurants, anywhere in the world.
1.7. Acquisition Sites.
Source: Item 22 — CONTRACTS (FDD page 61)
What This Means (2025 FDD)
According to Brueggers Bagels' 2025 Franchise Disclosure Document, a Development Agreement grants a developer the right to develop one or more Brueggers Bagels Bakeries within a specific territory. While the agreement is in effect, Brueggers Bagels will not establish Bakeries or franchise others to do so within the developer's designated Development Area. This provides the developer with a degree of exclusivity, protecting their investment and potential market share within that area. The specifics of the development, including the schedule, are outlined in Exhibit B of the Development Agreement. To proceed with development, the developer must execute a separate Brueggers Bagels Franchise Agreement for each Bakery.
However, Brueggers Bagels retains certain rights, even within the Development Area. They can operate or franchise Bakeries at Non-Traditional Locations, such as shopping malls, airports, or college campuses, regardless of their proximity to the developer's Bakeries. Brueggers Bagels also reserves the right to sell packaged food products or other goods and services under the Brueggers Bagels mark through channels other than Bakeries, such as supermarkets or the internet. Furthermore, Brueggers Bagels can use its brand in other lines of business besides restaurants, without restriction.
The Development Agreement does not grant the developer the right to use Brueggers Bagels' Proprietary Marks or System. These rights are granted solely under the terms of the individual Franchise Agreement executed for each Bakery. The developer cannot sub-franchise the rights to use the Proprietary Marks or the System to any other person or entity. If the developer fails to open a Bakery within the specified timeframe or does not meet the required number of Bakeries by the deadlines in the Development Schedule, Brueggers Bagels has the option to terminate the agreement.