Can the Franchisor extend the 180-day period for re-establishing a Bhc Franchised Business after an event causing inactivity?
Bhc Franchise · 2025 FDDAnswer from 2025 FDD Document
"Abandoned" means cessation of operation of the Franchised Business for a period of five consecutive business days, without Franchisor's prior written consent. A repeated pattern of inactivity at Franchisee's Franchised BHC Restaurant for periods of less than five consecutive business days may result in the Franchised Business being deemed Abandoned by Franchisee if in Franchisor's judgment such inactivity adversely impacts the Franchised Business. However, Franchisee's Franchised BHC Restaurant will not be deemed Abandoned if the inactivity is due to natural disasters or other matters reasonably beyond Franchisee's control, provided that Franchisee gives Franchisor notice of any such closure within five business days after the initial occurrence of the event resulting in such inactivity, and Franchisee acknowledges in writing that such inactivity is due to one of the foregoing causes, and provided further that Franchisee re-establish the Franchised Business and be fully operational within 180 days after the initial occurrence of the event resulting in such inactivity, or such longer period as Franchisor may permit.
Source: Item 23 — Receipts (FDD pages 52–230)
What This Means (2025 FDD)
According to Bhc's 2025 Franchise Disclosure Document, the franchisor has the discretion to extend the 180-day period for a franchisee to re-establish their business after an event causing inactivity. Specifically, if the inactivity is due to natural disasters or other matters reasonably beyond the franchisee's control, and the franchisee provides timely notice (within five business days) and written acknowledgment of the cause, the franchisee must re-establish the business within 180 days.
However, the agreement explicitly states that Bhc "may permit" a longer period. This clause provides Bhc with the flexibility to assess the situation and grant additional time if warranted. This could be beneficial for franchisees facing significant challenges in reopening their business due to circumstances beyond their immediate control.
It is important for prospective franchisees to understand that while Bhc has the option to extend the re-establishment period, it is not obligated to do so. The decision to grant an extension is at Bhc's discretion. Therefore, franchisees should maintain open communication with Bhc and provide detailed documentation of the reasons for any delays in re-establishing their business to increase the likelihood of obtaining an extension if needed.