Are there any intangible assets of Potbelly Sandwich Works that are not transferred to the purchaser?
Potbelly_Sandwich_Works Franchise · 2025 FDDAnswer from 2025 FDD Document
Section 2.03 Retained Assets. Notwithstanding anything in this Agreement to the contrary, the Assets to be transferred and assigned by Seller to Purchaser hereunder shall exclude the following (collectively, the "Retained Assets"): (a) any tangible assets of Seller that are not located at a Shop at the Effective Time; (b) any intangible assets of Seller that relate to more than just the Shops; (c) any patents, trademarks, copyrights, domain names, social media accounts or other intellectual property owned, under application or licensed by Seller or any of its Affiliates; (d) any owned real property related to the Shops (including any improvements thereon or thereat); (e) other than the Cash Bank included in the Special Items, any cash located at the Shops as of the Effective Time, including any cash in the Cash Safes as of the Effective Time; (f) any receivables related to the operations of the Shops prior to the Effective Time; (g) any deposits related to utility services; (h) any insurance policies, including all of Seller's rights in and to unearned premiums, refunds, and all claims or possible claims under such policies; (i) any current or historical files or records of Seller; (j) the application software and programs and wireless network software utilized in the point of sale (POS) system, manager's work station (MWS) and/or training work station (TWS) located in the Shops; (k) warranties and/or service agreements for the maintenance of Equipment located in the Shops, including the cash register system, coin changer, time clock, outside display board and drive-thru audio system except any warranties and/or service agreements that (i) automatically transfer to the Purchaser, as the new owner of the Equipment, (ii) do not require the consent of any third parties and (iii) do not impose any costs or expenses on Seller or
Source: Item 23 — RECEIPTS (FDD pages 79–355)
What This Means (2025 FDD)
According to Potbelly Sandwich Works' 2025 Franchise Disclosure Document, certain intangible assets are explicitly excluded from the transfer to the purchaser in an asset purchase agreement. These retained assets include any intangible assets that relate to more than just the specific Potbelly Sandwich Works shops being purchased.
Specifically, Potbelly Sandwich Works retains ownership of patents, trademarks, copyrights, domain names, social media accounts, and other intellectual property, whether owned, under application, or licensed by Potbelly Sandwich Works or its affiliates. Additionally, the application software and programs, along with wireless network software, utilized in the point of sale (POS) system, manager's work station (MWS), and training work station (TWS) located in the shops are also retained assets.
This means a new Potbelly Sandwich Works franchisee will not own these key intangible assets outright but will likely be granted a license to use them as part of the franchise agreement. This is a common practice in franchising, allowing Potbelly Sandwich Works to maintain brand consistency and control over its intellectual property while enabling franchisees to operate under the established brand.