What is the consequence if a Bhc franchisee fails to obtain consent for an assignment?
Bhc Franchise · 2025 FDDAnswer from 2025 FDD Document
- (e) Any attempt by Franchisee to assign the Franchise, all (or substantially all) the assets of the Franchised BHC Restaurant, or a controlling interest in Franchisee (if an entity) in violation of this section 12.2 is void and will (i) constitute a material breach of this Agreement, (ii) cause this Agreement (and in Franchisor's sole discretion any or all other agreements between Franchisee and Franchisor, or between Franchisee and Franchisor's affiliates) to be subject to immediate termination without further notice, and (iii) confer no rights or interest whatsoever under this Agreement upon any other party.
Source: Item 23 — Receipts (FDD pages 52–230)
What This Means (2025 FDD)
According to Bhc's 2025 Franchise Disclosure Document, if a franchisee attempts to assign their franchise, the assets of the franchised Bhc restaurant, or a controlling interest in the franchisee entity without obtaining the franchisor's consent, there are significant repercussions.
Specifically, any such attempt is considered void and constitutes a material breach of the franchise agreement. This breach can lead to the immediate termination of the agreement, without any further notice from Bhc. Furthermore, Bhc has the discretion to terminate any or all other agreements between the franchisee and Bhc, or between the franchisee and Bhc's affiliates.
Finally, the attempted assignment confers no rights or interests to any other party, meaning the purported assignee gains nothing from the transaction. This provision underscores the importance Bhc places on controlling who operates its franchises and ensures that unapproved transfers are unenforceable and carry severe penalties for the franchisee.