If Bhc operates the franchised restaurant on behalf of a deceased franchisee, what is the maximum period they can do so?
Bhc Franchise · 2025 FDDAnswer from 2025 FDD Document
as soon as practicable (but not more than 270 days) after the date of death in accordance with such person's will or, if such person dies without a will, in accordance with laws of intestacy governing the distribution of such person's estate, provided that adequate provision is made for the management of the Franchised Business. If Franchisor determines (i) there is no imminent sale to a qualified successor or (ii) there is no heir or other Principal Equity Operator capable of operating the Franchise, Franchisor may
(but is not obligated to) immediately commence operating the BHC Restaurant on Master Franchisee's behalf for a period of up to 90 days, renewable as Franchisor deems necessary for up to one year and Franchisor will periodically discuss the status with the h
Source: Item 23 — Receipts (FDD pages 52–230)
What This Means (2025 FDD)
According to Bhc's 2025 Franchise Disclosure Document, in the event of a franchisee's death, Bhc has the option to step in and operate the franchised restaurant. This is contingent on Bhc determining that there is no imminent sale to a qualified successor or no heir capable of operating the franchise. If Bhc chooses to operate the restaurant, it can do so for an initial period of up to 90 days.
Bhc can renew their operation of the restaurant as they deem necessary, but the total period of operation cannot exceed one year. During this time, Bhc will periodically discuss the status of the restaurant with the heirs of the deceased franchisee. This arrangement ensures that the business can continue to operate while the franchisee's estate is being settled and a suitable successor is found.
If Bhc decides to operate the restaurant, they can place an interim manager at the location. The costs associated with this manager, including salary, transportation, lodging, and related living expenses, are the responsibility of the franchisee's estate. Additionally, the estate must pay Bhc a management administration fee of 15%. This arrangement allows Bhc to maintain control over the restaurant's operations and standards during the transition period, while ensuring that the financial burden is borne by the franchisee's estate.