What must a Corner Bakery Cafe franchisee not be in to undertake a transfer?
Corner_Bakery_Cafe Franchise · 2025 FDDAnswer from 2025 FDD Document
If we do not exercise our right of first refusal as described in Section 15.9 (Our Right of First Refusal), the decision as to whether or not to consent to a proposed Transfer shall be made by us in our sole discretion and shall include numerous factors deemed relevant by us.
These factors may include, but will not be limited to, the following:
15.2.1 You and your Principals and affiliates must be in compliance with the provisions of this Agreement and all other agreements with us and our affiliates.
15.2.2 All of your accrued monetary obligations to us and our affiliates (whether arising under this Agreement or otherwise) and all other outstanding obligations related to the Franchised Cafe (including, but not limited to, bills from suppliers, taxes, judgments and any required governmental reports, returns, affidavits or bonds) have been satisfied or, in our reasonable judgment, adequately provided for.
We may require you to place a reasonable sum of money in escrow to ensure that all of these obligations are satisfied.
Source: Item 22 — CONTRACTS (FDD page 55)
What This Means (2025 FDD)
According to Corner Bakery Cafe's 2025 Franchise Disclosure Document, a franchisee and their principals and affiliates must be in compliance with the provisions of the Franchise Agreement and all other agreements with Corner Bakery Cafe and its affiliates to undertake a transfer.
Additionally, all accrued monetary obligations to Corner Bakery Cafe and its affiliates, whether arising under the Franchise Agreement or otherwise, and all other outstanding obligations related to the franchised Corner Bakery Cafe must be satisfied or adequately provided for. This includes bills from suppliers, taxes, judgments, and any required governmental reports, returns, affidavits, or bonds. Corner Bakery Cafe may require the franchisee to place a reasonable sum of money in escrow to ensure that all of these obligations are satisfied.
These conditions ensure that the Corner Bakery Cafe system maintains its integrity and financial stability by only allowing transfers to parties who are in good standing and financially responsible. This protects the brand and reputation of Corner Bakery Cafe and provides assurance to other franchisees within the system.