What qualifications must the transferee have to operate the Potbelly Sandwich Works shop?
Potbelly_Sandwich_Works Franchise · 2025 FDDAnswer from 2025 FDD Document
urrently with the proposed transfer's effective date:
(1) the transferee has the necessary business experience, aptitude, and financial resources to operate the Shop, completes our then-current form of franchise application, and otherwise is qualified under our then-existing standards for the approval of new franchisees or of existing franchisees interested in acquiring additional franchises (including the transferee and its affiliates are in substantial operational compliance, at the time of the application, under all other franchise agreements for Potbelly Shops to which they then are parties with us);
(2) you have paid all Royalties, Brand Fund contributions, and other amounts owed to us, our affiliates, and third-party vendors; have submitted all required reports and statements; and have not violated any material provision of this Agreement or any other agreement with us during both the sixty (60) day period before you requested our consent to the transfer and the period between your request and the transfer's proposed effective date;
(3) neither the transferee nor its owners or affiliates have an ownership interest (direct or indirect) in or perform services for a Competitive Business, wherever located or operating;
(4) the transferee's managing owner (or operator, as applicable) and general manager (if different from your Managing Owner or Operator, as applicable), satisfactorily complete required training within the timeframe we specify;
(5) the transferee has the right to occupy the Shop for the expected franchise term (whether by Lease assignment or sublet);
(6) any applicable agency or host or authority with jurisdiction over the Shop (such as an airport or an educational institution, if any) approves the transfer of this Agreement to the transferee;
Source: Item 22 — CONTRACTS (FDD page 79)
What This Means (2025 FDD)
According to Potbelly Sandwich Works' 2025 Franchise Disclosure Document, a transferee must meet several qualifications to operate a shop. The transferee needs to have sufficient business experience, aptitude, and financial resources. They must also complete Potbelly Sandwich Works' current franchise application and meet the standards for new franchisees. If the transferee already has existing Potbelly Sandwich Works franchises, they need to be in substantial operational compliance with those agreements.
Furthermore, the transferee or their owners cannot have any ownership interest in or perform services for a competing business. The managing owner or operator and general manager must also satisfactorily complete the required training within the specified timeframe. The transferee must also secure the right to occupy the shop for the expected franchise term, whether through a lease assignment or sublet. If applicable, any agency or authority with jurisdiction over the shop, such as an airport or educational institution, must approve the transfer of the franchise agreement.
Finally, the transferee must sign Potbelly Sandwich Works' current franchise agreement and related documents, which may have terms that differ from the original agreement. The term of the new franchise agreement will be equal to the unexpired term of the original agreement. These conditions ensure that any new operator is capable and committed to maintaining the standards and success of the Potbelly Sandwich Works franchise system.