Is a Bhc franchisee permitted to enter into a management agreement that provides the right to operate the franchised business?

According to Bhc's 2025 Franchise Disclosure Document, franchisees are explicitly restricted from entering into any agreement that would allow another party to operate the franchised business. Specifically, Bhc franchisees may not sublicense, sublease, subcontract, or enter into any management, concession, partnership, or joint venture agreement that provides the right to operate the franchised business or use the Bhc system.

This restriction ensures that the franchisee remains directly responsible for the operation and management of the Bhc restaurant. Bhc requires that a Principal Equity Operator, with or through a General Manager, participates personally in the direct operation of the restaurant. This requirement helps maintain the quality and consistency of the Bhc brand and customer experience.

The prohibition of management agreements is a fairly common practice in franchising. Franchisors like Bhc typically want to ensure that the business is run by individuals who are fully invested in the brand and have a direct financial stake in its success. By preventing franchisees from delegating operational control to third-party managers through such agreements, Bhc aims to uphold its standards and protect its brand reputation.