Can Potbelly Sandwich Works operate and change the Branded System in any manner?
Potbelly_Sandwich_Works Franchise · 2025 FDDAnswer from 2025 FDD Document
We and you acknowledge and agree that this SDAA (and the relationship of the parties which arises from this SDAA) grants us the right to make decisions, take actions and/or refrain from taking actions not inconsistent with your explicit rights and obligations hereunder that may affect favorably or adversely your interests. You understand and agree that we may operate and change the Branded System and our business in any manner that is not expressly and specifically prohibited by this SDAA. Unless expressly provided otherwise in this SDAA, we may make any decision, or exercise any of our rights and/or discretion under this SDAA, according to our judgment of what is in the best interests of us, our Affiliates, the Branded System, or the network of Potbelly Shops, without regard to: (a) whether other reasonable or even arguably preferable alternative decisions or actions were feasible; (b) whether our decision or action promotes our financial or other individual interest; (c) whether our decision or action applies differently to you and any one (1) or more other franchisees; or (d) whether our decision or the exercise of our rights is adverse to your individual interests or the individual interests of any other particular franchisees. We will have no liability to you for any such decision or exercise of our rights.
Source: Item 23 — RECEIPTS (FDD pages 79–355)
What This Means (2025 FDD)
According to Potbelly Sandwich Works' 2025 Franchise Disclosure Document, Potbelly Sandwich Works has the right to modify its branded system and business operations, provided these changes are not explicitly prohibited by the Development Agreement. This means Potbelly Sandwich Works can make decisions and take actions that may affect a franchisee's interests, as long as those actions don't violate the franchisee's specific rights and obligations detailed in the agreement.
Potbelly Sandwich Works can make changes or exercise its rights based on its judgment of what benefits Potbelly Sandwich Works, its affiliates, the Branded System, or the network of Potbelly Shops. This includes decisions that might affect franchisees differently or that might not be seen as the best possible choice. Potbelly Sandwich Works is not liable to franchisees for these decisions, even if they negatively impact a franchisee's individual interests.
This clause gives Potbelly Sandwich Works broad discretion in running the franchise system. For a potential franchisee, this highlights the importance of carefully reviewing the Development Agreement to understand exactly what rights are protected. It also means franchisees must be prepared for changes in the system, and should carefully consider how much risk they are willing to take, knowing that Potbelly Sandwich Works has considerable latitude to evolve the business model.