What is the purpose of the Non-Traditional Location Addendum for Potbelly Sandwich Works?
Potbelly_Sandwich_Works Franchise · 2025 FDDAnswer from 2025 FDD Document
-TRADITIONAL LOCATION ADDENDUM TO FRANCHISE AGREEMENT
| THIS NON-TRADITIONAL LOCATION ADDENDUM TO FRANCHISE AGREEMENT | |
|---|---|
| (this "Addendum") is made and entered into as of the day of | |
| , 20 | |
| , (the "Effective | |
| Date") (regardless of the dates of, but only upon, the parties' full signatures) by and between POTBELLY | |
| FRANCHISING, LLC, an Illinois limited liability company with its principal business address at 500 | |
| West Madison Street, Suite 1000, Chicago, Illinois 60661 ("we", "us" or "our") and | |
| , a(n) | |
| , whose principal business address is | |
| ("you" or "your"). | |
| 1. | Preambles and Acknowledgements. Simultaneously with signing this Addendum, we and |
| you are signing a Franchise Agreement (the "Franchise Agreement") to govern your development and | |
| operation of a Potbelly Sandwich Shop (defined below) at the Site. All initial capitalized terms used but not | |
| defined in this Addendum have the meanings given to these terms in the Franchise Agreement. We and you | |
| are signing this Addendum to modify certain provisions of the Franchise Agreement to recognize that the | |
| Potbelly Sandwich Shop will be located within the | |
| (for purposes of this Addendum and in the Franchise Agreement, the "Facility"), which is a Non-Traditional | |
| Location (defined below), and to accommodate certain requests you have made as a result of that location. | |
| "Non-Traditional Location," in this Addendum and in the Franchise Agreement, means any permanent or | |
| temporary food service facility that operates (1) under one or more of the Marks and all or part of the | |
| Franchise System, and (2) at locations that do not feature unlimited and unrestricted access to the general | |
| public. Non-Traditional Locations include, but are not limited to: hospitals or medical centers, airports, | |
| public or private schools, universities or college campuses, airport terminals, train or bus stations, | |
| convention centers, exhibition halls, amusement parks, fairgrounds, sports arenas, military bases, state or | |
| national parks, hotels, lodges, country clubs, social clubs, resorts, casinos, theaters, food trucks, or any other | |
| similar site or venue that generates customer flow that is independent from the general customer traffic flow | |
| of the surrounding area (collectively, "Non-Traditional Venues"). | |
| 2. | Other Business. Subsection 1.C(6) of the Franchise Agreement is deleted in its entirety. |
| 3. | Grant of Franchise. Section 1.D of the Franchise Agreement is deleted in its entirety and |
| replaced with the following: | |
| D. | GRANT OF FRANCHISE. |
| You have applied for a non-traditional franchise to operate a Potbelly Shop at | |
| (the "Site"). Subject to this Agreement's terms, we grant | |
| you a franchise (the "Franchise") to operate a Potbelly Shop (the "Shop") at the Site, and to use | |
| the Franchise System in its operation, for a ten (10) year term beginning on the Effective Date (the | |
| "Term") The Term is subject to earlier termination under Section 14. You agree to operate the | |
| Shop in compliance with this Agreement for the entire Term unless this Agreement is properly | |
| terminated under Section 14. You may use the Site during the Term only for the Shop. You agree | |
| at all times faithfully, honestly, and diligently to perform your obligations under this Agreement | |
| and to use best efforts to promote the Shop. You may not engage in any delivery or catering | |
| activities away from the Site, or take customer orders "on-line" (i.e., through the System Website |
or any other Electronic Media), unless and until we require you to do so or notify you in writing that you may do so (although we have no obligation to allow such activities by a certain date or at all. If we require or allow you to engage in any or all of these activities, you must comply with all
System Standards for such activities, including without limitation, making available the Products identified as appropriate for delivery, using only the delivery service provider(s) we specify in writing for your Shop, and limiting the delivery services to any delivery area we specify to you in writing. Since the Site of the Shop is located at or within a Non-Traditional Location, your delivery and catering area will be limited to the Facility and shall be deemed exclusive to you only in the Facility. You acknowledge and agree that any delivery and/or catering services performed outside of the parameters of the Non-Traditional Location shall be deemed non-exclusive and we may engage, and/or allow other franchisees and third parties to engage, in any activities we desire within the non-exclusive delivery area without any restrictions (including allowing other Potbelly Shops and delivery service providers to provide delivery services in the delivery area).
Source: Item 22 — CONTRACTS (FDD page 79)
What This Means (2025 FDD)
According to Potbelly Sandwich Works's 2025 Franchise Disclosure Document, the Non-Traditional Location Addendum to the Franchise Agreement is designed to modify certain provisions of the standard agreement to accommodate a Potbelly Sandwich Shop located within a "Facility," which is considered a Non-Traditional Location. This addendum acknowledges that these locations, unlike traditional ones, do not have unlimited and unrestricted access to the general public. Examples of Non-Traditional Locations include hospitals, airports, schools, universities, and amusement parks. The addendum is signed simultaneously with the Franchise Agreement and takes effect on the specified Effective Date.
The addendum modifies the standard Franchise Agreement to account for the unique characteristics of non-traditional venues. For instance, it addresses the franchisee's request to operate within such a location. It also defines "Non-Traditional Location" as any food service facility operating under the Potbelly Sandwich Works brand that doesn't have unrestricted public access, including venues with customer flow independent of the surrounding area's general traffic.
Specifically, the Non-Traditional Location Addendum alters sections of the standard Franchise Agreement. It deletes Subsection 1.C(6) and replaces Section 1.D, which concerns the Grant of Franchise, to reflect the non-traditional nature and site of the franchise. It also replaces Section 2.A regarding Site Selection. Furthermore, the addendum addresses delivery and catering activities, limiting them to the Facility and specifying that any services outside this area are non-exclusive, allowing Potbelly Sandwich Works to engage other franchisees or third parties in those areas.