Can the Master Franchise Agreement for Bhc be amended without notice to the undersigned guarantors?
Bhc Franchise · 2025 FDDAnswer from 2025 FDD Document
The undersigned further hereby agree that without the consent of or notice to any of the undersigned and without affecting any of the obligations of the undersigned hereunder: (i) any term, covenant or condition of the Master Franchise Agreement may be amended, compromised, released or otherwise altered by Franchisor and Master Franchisee, and the undersigned do guarantee and promise to perform all the obligations of Master Franchisee under the Agreement as so amended, compromised, released or altered; (ii) any guarantor of or party to the Master Franchise Agreement may be released, substituted or added; (iii) any right or remedy under the Master Franchise Agreement, this Guarantee or any other instrument or agreement between Franchisor and Master Franchisee may be exercised, not exercised, impaired, modified, limited, destroyed or suspended; and, (iv) Franchisor or any other person may deal in any manner with Master Franchisee, any of the undersigned, any party to the Master Franchise Agreement or any other person.
Source: Item 23 — Receipts (FDD pages 52–230)
What This Means (2025 FDD)
According to Bhc's 2025 Franchise Disclosure Document, the Master Franchise Agreement can be amended without notice to the undersigned guarantors. The document states that the guarantors are still bound by the agreement even if changes are made without their consent or notification. This means that any modifications, compromises, releases, or alterations to the Master Franchise Agreement can occur between Bhc and the Master Franchisee without informing the guarantors, and the guarantors are still responsible for fulfilling the Master Franchisee's obligations under the altered agreement.
This lack of required notification places a significant responsibility on the guarantors. They are essentially agreeing to be bound by changes they may not be aware of, which could potentially increase their liability. The guarantors also agree that any guarantor of the Master Franchise Agreement may be released, substituted, or added without notice to any of the undersigned.
Furthermore, Bhc has the right to exercise or not exercise any right or remedy under the Master Franchise Agreement, this Guarantee, or any other agreement between Bhc and the Master Franchisee, and can deal with any party in any manner without affecting the obligations of the guarantors. This provision underscores the extensive power Bhc retains to modify the terms and conditions of the agreement without needing the guarantors' consent or even informing them.
For a prospective franchisee, this highlights the critical importance of fully understanding the terms of the guarantee and the potential risks involved. It would be prudent to seek legal counsel to assess the implications of this clause and to negotiate for some level of notification or consent rights regarding amendments to the Master Franchise Agreement.