After assigning the Master Franchise Agreement to an Affiliated Entity, is the Bhc Master Franchisee allowed to maintain direct ownership and operation of Bhc Restaurants that the Master Franchisee (or its Affiliated Entities) has developed?
Bhc Franchise · 2025 FDDAnswer from 2025 FDD Document
- (b) Any assignment and transfer by Master Franchisee of the rights, duties and obligations under this Agreement to an Affiliated Entity must be evidenced by a written instrument, in form reasonably satisfactory to Franchisor, under the terms of which said business entity expressly assumes all of Master Franchisee's rights, duties, and obligations hereunder, whether accrued at the time of such assignment or arising thereafter, and the assignee agrees to be bound by all the terms and provisions of this Agreement to the same extent and in the same manner as Master Franchisee is. A copy of said instrument, executed by both Master Franchisee and said business entity must be delivered to Franchisor before the effective date of the transfer. Master Franchisee will not be able to maintain direct ownership and operation of the BHC Restaurants which Master Franchisee (or its Affiliated Entities) has developed after such assignment.
Source: Item 23 — Receipts (FDD pages 52–230)
What This Means (2025 FDD)
According to Bhc's 2025 Franchise Disclosure Document, a Master Franchisee is not able to maintain direct ownership and operation of Bhc Restaurants after assigning the Master Franchise Agreement to an Affiliated Entity. This restriction applies to restaurants that the Master Franchisee or its Affiliated Entities have developed.
Before assigning the agreement, the Master Franchisee must provide at least 30 days' prior written notice to Bhc and obtain Bhc's written consent for the assignment. The entity receiving the assignment must be organized to operate as a developer of Bhc Restaurants and be entirely owned by the Master Franchisee.
This policy ensures that once the Master Franchise Agreement is transferred, the original Master Franchisee relinquishes control and operational responsibilities for the developed restaurants. This is likely to maintain brand consistency and standards under the new management. A prospective franchisee should carefully consider this restriction, especially if they intend to retain some level of operational involvement after assigning their agreement.