Under the Potbelly Sandwich Works Principal's Agreement, when will the agreement terminate?

According to Potbelly Sandwich Works' 2025 Franchise Disclosure Document, the Principal's Agreement will terminate only upon the termination or expiration of the obligations outlined in the Franchise Agreement. This means that the Principal's Agreement, which binds the individual principals to certain obligations under the Franchise Agreement, remains in effect as long as the Franchise Agreement itself is active and its obligations are relevant.

Specifically, the principals are bound by sections of the Franchise Agreement related to responsibilities and liabilities. These sections cover various aspects of the franchise operation, and the Principal's Agreement ensures that these individuals are personally accountable for compliance. This personal accountability is independent of any actions Potbelly Sandwich Works might take against the franchise entity itself.

For a prospective Potbelly Sandwich Works franchisee, this implies that the personal obligations of the principals extend for the entire duration of the Franchise Agreement. It is crucial for principals to understand the terms and conditions of the Franchise Agreement, as their personal assets and actions could be at stake if the franchise fails to meet its obligations. This arrangement is fairly standard in franchising, as it provides an additional layer of security for the franchisor, ensuring commitment and compliance from the individuals behind the franchise entity.