Does Bhc have independent enforcement rights regarding franchisee non-disclosure agreements?
Bhc Franchise · 2025 FDDAnswer from 2025 FDD Document
You may not use our confidential information in an unauthorized manner. You must take reasonable steps to prevent improper disclosure to others and use non-disclosure and noncompetition agreements with those having access. We may regulate the form of agreement that you use and will be a third-party beneficiary of that agreement with independent enforcement rights.
Source: Item 14 — Patents, Copyrights, And Proprietary Information (FDD pages 41–42)
What This Means (2025 FDD)
According to Bhc's 2025 Franchise Disclosure Document, Bhc retains independent enforcement rights regarding franchisee non-disclosure agreements. Specifically, Bhc's confidential information is detailed in its Operations Manual and other materials, including site selection criteria, recipes, training and operations materials, methods, formats, specifications, standards, systems, procedures, food preparation techniques, sales and marketing techniques, knowledge, and experience used in developing and operating Bhc Restaurants, marketing and advertising programs, proprietary computer software, knowledge of approved suppliers, operating results, financial performance, and graphic designs.
Bhc mandates that franchisees implement non-disclosure and non-competition agreements with individuals who have access to this confidential information. Bhc also retains the right to regulate the form of these agreements.
Importantly, Bhc is identified as a third-party beneficiary of these agreements, granting Bhc independent enforcement rights. This means Bhc can directly enforce these agreements against employees or others who violate them, even if the franchisee does not take action. This provision is designed to protect Bhc's proprietary information and maintain uniformity within the franchise system.