If the Bhc Master Franchisee is an entity, what documentation regarding its organization must be provided to the Franchisor at the Effective Date?
Bhc Franchise · 2025 FDDAnswer from 2025 FDD Document
ndirect interest in this Agreement, the BHC Restaurant or the economic benefits derived therefrom, or any equity interest in Master Franchisee's franchised entity, not permitted by the preceding section 12.4, only after written notice to Franchisor and only with Franchisor's written consent, which will not be unreasonably withheld.
12.6 Transfers from Master Franchisee to an Affiliated Entity.
- (a) Upon not less than 30 days' prior written notice to Franchisor, Master Franchisee may, upon Franchisor's written consent, assign and transfer this Agreement at its entirety to an entity that is (i) organized to operate as a developer of BHC Restaurants and (ii) entirely owned by Master Franchisee ("Affiliated Entity").
- (b) Any assignment and transfer by Master Franchisee of the rights, duties and obligations under this Agreement to an Affiliated Entity must be evidenced by a written instrument, in form reasonably satisfactory to Franchisor, under the terms of which said business entity expressly assumes all of Master Franchisee's rights, duties, and obligations hereunder, whether accrued at the time of such assignment or arising thereafter, and the assignee agrees to be bound by all the terms and provisions of this Agreement to the same extent and in the same manner as Master Franchisee is. A copy of said instrument, executed by both Master Franchisee and said business entity must be delivered to Franchisor before the effective date of the transfer. Master Franchisee will not be able to maintain direct ownership and operation of the BHC Restaurants which Master Franchisee (or its Affiliated Entities) has developed after such assignment.
13. DEFAULT AND TERMINATION
13.1 General.
(a) This Agreement may be terminated unilaterally by Franchisor or Master Franchisee only "for cause", which for purposes of this Agreement means a material violation of this Agreement and
includes any failure of a party to substantially comply with any obligation, duty or promise under this Agreement, including those acts or omissions specified in sections 13.2 and 13.3 hereof. If Franchisor is in material breach of this Agreement, Master Franchisee may terminate this Agreement by giving Franchisor prior written notice setting forth the asserted breach of this Agreement and giving Franchisor 30 days in which to cure the breach. If Master Franchisee is in material breach of this Agreement, Franchisor may exercise Franchisor's right to terminate this Agreement in accordance with this Article 13.
Source: Item 23 — Receipts (FDD pages 52–230)
What This Means (2025 FDD)
Based on the 2025 Bhc Franchise Disclosure Document, if the Master Franchisee is an entity and intends to assign the agreement to an affiliated entity, the Master Franchisee must provide written notice to Bhc at least 30 days in advance and obtain Bhc's written consent. The entity must be organized to operate as a developer of Bhc Restaurants and be entirely owned by the Master Franchisee.
To complete the transfer, a written instrument, satisfactory to Bhc, must be executed, in which the affiliated entity expressly assumes all of the Master Franchisee's rights, duties, and obligations under the agreement. A copy of this instrument, signed by both the Master Franchisee and the affiliated entity, must be delivered to Bhc before the transfer takes effect. After the assignment, the Master Franchisee cannot maintain direct ownership and operation of the Bhc Restaurants that the Master Franchisee (or its Affiliated Entities) has developed.
Additionally, prior to any assignment by the Master Franchisee, the Master Franchisee must notify Bhc of their intent to sell, transfer, or assign the franchise, including a copy of all agreements related to the sale, assignment, or transfer of the franchise. The Master Franchisee must also provide the proposed transferee's application for approval to become the successor Master Franchisee, including all forms, financial disclosures, and related information generally used by Bhc when interviewing prospective new Master Franchisees, if Bhc makes those forms available to Master Franchisee.