What is the definition of 'Affiliate' in relation to a party within the context of the Bhc agreement?

According to Bhc's 2025 Franchise Disclosure Document, an 'Affiliate' in relation to a party means any person controlling, controlled by, or under common control with such party, either directly or indirectly through one or more intermediaries. This definition is important because it clarifies the relationships between different entities that may be involved in the franchise agreement.

For a prospective franchisee, understanding this definition is crucial for several reasons. First, it helps to identify any potential conflicts of interest that may arise if Bhc or the franchisee has affiliates involved in similar or competing businesses. Second, it clarifies the scope of responsibility and liability, as the actions of an affiliate may have implications for the franchisee or Bhc. Finally, it helps in understanding the overall structure of the Bhc organization and how different entities within the organization relate to each other.

Furthermore, the FDD also defines an 'Affiliate Franchisee' as any person controlling, controlled by, or under common control with the Master Franchisee, either directly or indirectly through one or more intermediaries. This is relevant because Master Franchisees may only operate Bhc restaurants through an Affiliate Franchisee that enters into a Subfranchise Agreement with the Master Franchisee. This structure ensures that all restaurants, even those operated by affiliates, are subject to the terms and conditions of a Subfranchise Agreement, maintaining consistency and quality across the Bhc system.