Is the Bhc Master Franchisee allowed to disclose Proprietary Information after the agreement terminates?
Bhc Franchise · 2025 FDDAnswer from 2025 FDD Document
g party will be determined by the arbitrator or court. This section 14.4 is (i) intended to be expressly severable from the other provisions of this Agreement, (ii) intended to survive any judgment, and (iii) not to be deemed merged into the judgment.
14.5 Survival.
The terms of this Article 14 survive termination, expiration or cancellation of this Agreement.
15. OBLIGATIONS AND RIGHTS UPON TERMINATION OR EXPIRATION
15.1 Master Franchisee's Obligations.
- (a) In the event of termination, cancellation or expiration of this Agreement whether by reason of Master Franchisee's breach, default, non-renewal, lapse of time or other cause, in addition to any other obligations provided for in this Agreement, Master Franchisee must forthwith discontinue the use or display of the Marks in any manner whatsoever, and Master Franchisee may not thereafter operate or do business under the Marks or any other BHC brand or any other name or in any manner that might tend to give the general public the impression that Master Franchisee is in any way associated or affiliated with Franchisor, or any of the businesses conducted by Franchisor or the Owner of the Marks, including without limitation repainting the business premises in a distinctively different color and removing or rearranging distinctive elements of the Trade Dress. Master Franchisee must contact online review sites and other online directories and websites which have made reference to Master Franchised BHC Restaurant during the 18 months prior to the date this Agreement terminates, is cancelled, or expires, and request the removal of all use of the trademarks in connection with the former BHC franchised BHC Restaurant (and the physical address of the former BHC Restaurant) and all use of former reviews from the period Master Franchisee was a BHC Master Franchisee. And, Master Franchisee also must comply with section 15.2 respecting the return to Franchisor of certain materials and must not thereafter use, in any manner, or for any purpose, directly or indirectly, any of the Proprietary Information, Trade Secrets, procedures, techniques, or materials acquired by Master Franchisee by virtue of the relationship established by this Agreement, including, without limitation, (i) any training or other materials, manuals, bulletins, instruction sheets, or supplements thereto, or (ii) any equipment, videotapes, videodiscs, forms, advertising matter, devices, insignias, slogans or designs used from time to time in connection with the Franchised Business.
Source: Item 23 — Receipts (FDD pages 52–230)
What This Means (2025 FDD)
According to Bhc's 2025 Franchise Disclosure Document, the Master Franchisee is expressly prohibited from using or disclosing any Proprietary Information or Trade Secrets after the termination, cancellation, or expiration of the Master Franchise Agreement. This restriction is highlighted in section 15.1(a) of the agreement, which outlines the Master Franchisee's obligations upon termination.
Specifically, the Master Franchisee cannot use any Proprietary Information, Trade Secrets, procedures, techniques, or materials acquired during the term of the agreement. This includes training materials, manuals, bulletins, instruction sheets, equipment, videotapes, forms, advertising matter, devices, insignias, slogans, or designs. The terms of Article 14, which likely contains these confidentiality clauses, survive the termination of the agreement, reinforcing the ongoing nature of these obligations.
This provision is typical in franchising to protect the franchisor's intellectual property and maintain the uniformity of the brand. For a prospective Bhc Master Franchisee, this means that the knowledge and materials gained during the franchise term cannot be used in any competing business or for any purpose that is not directly related to operating a Bhc restaurant under the agreement. This restriction remains in effect even after the agreement ends, regardless of the reason for termination.