What constitutes a 'Franchised Business' or 'Business' for a Bhc restaurant?
Bhc Franchise · 2025 FDDAnswer from 2025 FDD Document
n 5% of the voting right or equity interest in Franchisee and the individual who will be responsible for the development and operation of the Franchised Business. All communication with Franchisee shall be through the Principal Equity Operator.
"Royalty" or "Royalties" means the ongoing fee (calculated as a percentage of Franchisee's Gross Revenues) that Franchisee must pay Franchisor on a biweekly basis as described in and required by section 4.3 hereof.
"Franchised BHC Restaurant" means a full fast casual fried chicken restaurant at a location Franchisor consents to and which is operated by Franchisee and exclusively dedicated to the operation of the Franchised Business under the Marks and in accordance with the System.
"System" means, collectively, the valuable operational systems prescribed by Franchisor to be used in the conduct of the Franchised Business, as set forth in this Agreement and the Operations Manual. The System includes (i) the Marks, (ii) know-how relating to BHC Products, (iii) advertising, marketing and sales programs and techniques, (iv) training programs, and (vi) related materials, artwork, graphics, layouts, slogans, names, titles, text, and other Intellectual Property that Franchisor makes available to Franchisee. In its sole discretion, Franchisor may improve or change the System from time to time. All such modifications and improvements become Franchisor's property and a part of Franchisor's Intellectual Property and System.
"Territory" means the designated and agreed geographical area surrounding Franchisee's Franchised BHC Restaurant as set forth in Exhibit 1 attached hereto.
"Trade Dress" means the unique and distinctive layout, design and color schemes relating to the Franchised BHC Restaurant, and the textures, sizes, designs, shapes, and placements of words, graphics, and decorations on products and packaging related to BHC Products.
"Trade Secret" The term "Trade Secret" means information constituting a trade secret within the meaning of the Defend Trade Secrets Act, as amended from time to time.
"Transfer" means to voluntarily or involuntarily assign, sell, or encumber any interest in or ownership or control of, the Franchised BHC Restaurant, substantial assets of the Franchised BHC Restaurant, of this Agreement or any interest in the legal entity which owns the Franchised BHC Restaurant, by operation of law or otherwise.
2. THE FRANCHISED BUSINESS
2.1 Franchisor's Business.
Franchisor is engaged in the administration, development, operation, and licensing of businesses that operate Franchised BHC Restaurants offering the Franchised Business, using the Marks, operational techniques, service concepts and proprietary information owned or authorized to be used by and identified with Franchisor and its affiliated companies. Franchisor's activities in general, and the System (including proprietary products and services; logos; equipment and operations; designs and layouts for the Franchised BHC Restaurants;
Source: Item 23 — Receipts (FDD pages 52–230)
What This Means (2025 FDD)
According to Bhc's 2025 Franchise Disclosure Document, the 'Franchised Business' refers to the operation of a full fast-casual fried chicken restaurant under the Bhc brand, offering Korean-flavored fried chicken and related products and services. This business must be conducted at a location that Bhc approves and must be exclusively dedicated to operating under the Bhc trademarks and operational systems.
The 'System' that Bhc franchisees use includes the brand's trademarks, knowledge related to Bhc products, marketing and advertising strategies, training programs, and all associated materials and intellectual property. Bhc retains the right to modify or improve this system, with all changes becoming Bhc's property. Franchisees are required to adhere strictly to the procedures outlined in the Operations Manual and any written directives from Bhc.
Franchisees are obligated to sell Bhc products and other approved food and beverages specified in the authorized menu, sourced from designated vendors. They must also maintain adequate inventory levels to ensure smooth operations. Online ordering must be conducted through Bhc's official website. Franchisees must use the standard signs and formats prescribed by Bhc.
The agreement also stipulates that franchisees, or their General Manager, must dedicate their full time during normal business hours to managing and developing the Franchised Business. At least one Principal Equity Operator, along with the General Manager, must be actively involved in the direct operation of the Bhc restaurant. Franchisees are expected to diligently address customer reviews and cooperate with Bhc in resolving any customer complaints.