What is Bhc Franchisor's policy regarding the ownership of proprietary information and training materials provided to the Master Franchisee?
Bhc Franchise · 2025 FDDAnswer from 2025 FDD Document
At Initial Training and other training programs and conferences, Franchisor may provide Master Franchisee with Proprietary Information, as well as training materials, training curricula and related materials for Master Franchisee's use in training Master Franchisee's staff. All of these items are and will remain Franchisor's sole and exclusive property. Master Franchisee must not, nor allow its employees or others to, copy, reproduce, disseminate, or otherwise reveal to third parties any Proprietary Information and related materials, without Franchisor's express prior written consent.
9.3 Trade Secrets and Proprietary Information.
- (a) Under this Agreement, Franchisor is granting Master Franchisee access to the Proprietary Information, and Franchisor's other confidential data and information.
Master Franchisee acknowledges that the material and information now and hereafter provided or revealed to Master Franchisee pursuant to this Agreement (including in particular, but without limitation, the contents of the Operations Manual) are Franchisor's Trade Secrets and are revealed in confidence, and Master Franchisee expressly agrees to keep and respect the confidences so reposed, both during the term of this Agreement and thereafter.
Franchisor expressly reserves all rights with respect to the Marks, Proprietary Information, methods of operation and other proprietary information, except as may be expressly granted to Master Franchisee hereby or in the Operations Manual.
Franchisor will disclose to Master Franchisee certain Trade Secrets as reasonably needed for the operation by Master Franchisee of the Franchised Business by loaning to Master Franchisee, for the term of this Agreement, the Operations Manual and other written materials containing the Trade Secrets, through training and assistance provided to Master Franchisee hereunder, and by and through the performance of Franchisor's other obligations under this Agreement.
- (b) Master Franchisee acknowledges that Franchisor is the sole owner of all Proprietary Information, including the Trade Secrets; that such information is being imparted to Master Franchisee only because of Master Franchisee's special status as a Master Franchisee of the System; and that the Proprietary Information is not generally known to Franchisor's industry or the public at large and is not known to Master Franchisee except by reason of such disclosure.
Master Franchisee further acknowledges that Master Franchisee will acquire no interest in the Proprietary Information disclosed to Master Franchisee, other than the right to use it in the development and operation of the BHC Restaurant during the term of this Agreement.
Source: Item 23 — Receipts (FDD pages 52–230)
What This Means (2025 FDD)
According to Bhc's 2025 Franchise Disclosure Document, Bhc retains sole and exclusive ownership of all proprietary information and training materials provided to the Master Franchisee. This includes materials provided during initial training, other training programs, and conferences. The proprietary information includes trade secrets and confidential data necessary for operating the Bhc restaurant.
The Master Franchisee is granted access to this information solely for the purpose of operating the franchised business during the term of the agreement. The Master Franchisee acknowledges that the proprietary information is not generally known and is being disclosed specifically because of their status as a Master Franchisee within the Bhc system. The Master Franchisee gains no ownership interest in the proprietary information beyond the right to use it for their Bhc restaurant.
The Master Franchisee is explicitly prohibited from copying, reproducing, disseminating, or revealing any proprietary information or related materials to third parties without Bhc's express prior written consent. This restriction extends to the contents of the Operations Manual, which is considered a Trade Secret and is loaned to the Master Franchisee for the duration of the agreement. This ensures that Bhc maintains control over its brand standards, operational methods, and confidential business practices, which is a common practice in franchising to protect the integrity and uniformity of the brand.