When is the Initial Deposit for a Bhc Master Franchise Business due?
Bhc Franchise · 2025 FDDAnswer from 2025 FDD Document
if you fail to open a BHC Restaurant.
In addition, the Initial Deposit for a Master Franchise Business is $20,000 for each BHC Restaurant in your Development Schedule ("Initial Deposit"). The Deposit is due and payable in full when you sign the MFA. The purpose of the Deposit is to secure against non-payment of your obligations under the MFA, and we reserve the right to use the Deposit to compensate ourselves for certain damages and expenses during the term of the MFA, and you must replenish the Deposit to its original amount if we make any deductions. Upon the expiration or termination of the MFA, we will return to you the remaining amount of the Initial Deposit, if any, without interest, after offsetting any sums owed you owe to us as soon as reasonably practicable.
For each Subfranchised BHC Restaurant that you subfranchise to third parties, you will cause the Subfranchisees to pay us four and one-half percent (4.5%) of Gross Revenues of the Master Franchised BHC Restaurants. The royalty you charge to Subfranchisees shall not exceed seven percent (7%) of Gross Revenues of the Subfranchised BHC Restaurants.
Before you open your first Affiliate Franchised BHC Restaurant or your Subfranchisee open their Subfranchised BHC Restaurant, as applicable, you, your Affiliate Franchisee or your Subfranchisees, as applicable, must purchase opening inventory of merchandise and supplies that includes certain proprietary products that you, your Affiliate Franchisee, or your Subfranchisees, as applicable, must purchase from us and our affiliates. We estimate that your, your Affiliate Franchisee's, or your Subfranchisees', as applicable, cost of pre-opening inventory for each Affiliate Franchised BHC Restaurant or Subfranchised BHC Restaurant will be between $10,000 to $20,000. You, your Affiliate Franchisee, and your Subfranchisees must also pay for Site Design Review Fee and Site Review Fee, as applicable.
Source: Item 5 — Initial Fees (FDD pages 11–12)
What This Means (2025 FDD)
According to Bhc's 2025 Franchise Disclosure Document, the Initial Deposit for a Master Franchise Business is due in full when you sign the Master Franchise Agreement (MFA). The deposit is $20,000 for each Bhc Restaurant in your Development Schedule. This deposit must be paid via cashier's check, money order, or wire transfer.
The purpose of the Initial Deposit is to protect Bhc against non-payment of your obligations under the MFA. Bhc retains the right to use the deposit to cover damages and expenses incurred during the term of the MFA. If Bhc deducts any amount from the deposit, you are obligated to replenish the deposit back to its original amount within ten business days of the deduction.
Upon the expiration or termination of the MFA, Bhc will return any remaining amount of the Initial Deposit, without interest, after offsetting any sums you owe to them. This refund is contingent upon your full compliance with all obligations outlined in the agreement, including post-termination obligations. The refund will be processed within sixty days of the agreement's expiration or termination.