Besides the franchisee, who else is prohibited from diverting business or acting injuriously to the goodwill of the Bhc brand?
Bhc Franchise · 2025 FDDAnswer from 2025 FDD Document
It is the intention of both Franchisee and Franchisor that Franchisee maximizes the Franchised Business within the Territory, and any action of Franchisee that diverts business to another entity or diminishes the Franchised Business being conducted in the Territory will be a material breach of this Agreement. Accordingly, neither Franchisee nor any Principal Equity Operator may, either directly or indirectly, for itself or themselves, or through, on behalf of, or in conjunction with, any person, persons, partnership, corporation or other entity, (i) divert or attempt to divert any business or customer of the Franchised Business to any competitor, by direct or indirect inducement or otherwise, or (ii) do or perform, directly or indirectly, any other act injurious or prejudicial to the goodwill associated with the Marks or the System.
Source: Item 23 — Receipts (FDD pages 52–230)
What This Means (2025 FDD)
According to Bhc's 2025 Franchise Disclosure Document, in addition to the franchisee, any Principal Equity Operator is also prohibited from diverting business or acting injuriously to the goodwill associated with the Bhc brand.
Specifically, the FDD states that neither the franchisee nor any Principal Equity Operator can divert business or customers to a competitor, either directly or indirectly. They are also prohibited from performing any act that could be harmful or damaging to the goodwill associated with Bhc's trademarks or the overall system.
This restriction is in place to ensure that all parties involved in the operation of a Bhc franchise are committed to maximizing the success of the business and upholding the brand's reputation. It prevents individuals with a significant stake in the franchise from engaging in activities that could benefit a competing business at the expense of the Bhc franchise.