If I assign my Bhc franchise, does the non-competition obligation still apply to me?
Bhc Franchise · 2025 FDDAnswer from 2025 FDD Document
| Provision | Section in Multi-Unit Master Franchise Agreement | Summary |
|---|---|---|
| r. Non-competition covenants during the term of the franchise | 5.1 | No involvement in competing business anywhere. |
| s. Non-competition | 11.1 | No competing business for two years within 25 miles of your Master Franchised BHC Restaurant or any other Master Franchised BHC Restaurant or other retail location (this obligation also applies to you if you assign your franchise). The MFA refers to the confidentiality and non-competition covenant in the last MFA you sign. (This provision is subject to state law.) |
| covenants after | ||
| the franchise is | ||
| terminated or | ||
| expires |
Source: Item 17 — Renewal, Termination, Transfer, And Dispute Resolution (FDD pages 43–49)
What This Means (2025 FDD)
According to Bhc's 2025 Franchise Disclosure Document, if you assign your franchise, the non-competition obligation still applies to you. Specifically, after the franchise is terminated or expires, you are restricted from involvement in any competing business for two years within 25 miles of your Master Franchised Bhc Restaurant, any other Master Franchised Bhc Restaurant, or any other retail location.
This means that even after you transfer ownership of your Bhc franchise, you cannot operate or be involved in a competing business within the specified geographic area for the stated duration. This restriction is designed to protect Bhc's market share and brand reputation by preventing former franchisees from using their knowledge of the Bhc system to benefit a competing business in close proximity to existing Bhc locations.
Prospective franchisees should carefully consider this non-competition clause, as it could limit their future business opportunities after they decide to sell or transfer their Bhc franchise. It is important to understand the scope and duration of the restriction and how it might impact any plans to remain in the restaurant industry or start a similar business venture after exiting the Bhc system. Franchisees should consult with legal counsel to fully understand the implications of this clause and negotiate any potential modifications before signing the franchise agreement.