What is the required notice period a Bhc franchisee must provide to the franchisor before assigning the agreement to an Affiliated Entity?
Bhc Franchise · 2025 FDDAnswer from 2025 FDD Document
12.6 Transfers from Franchisee to an Affiliated Entity.
- (a) Upon not less than 30 days' prior written notice to Franchisor, Franchisee may, upon Franchisor's written consent, assign and transfer this Agreement at its entirety to an entity that is (i) organized to operate as a developer of Franchised BHC Restaurants and (ii) entirely owned by Franchisee ("Affiliated Entity").
- (b) Any assignment and transfer by Franchisee of the rights, duties and obligations under this Agreement to an Affiliated Entity must be evidenced by a written instrument, in form reasonably satisfactory to Franchisor, under the terms of which said business entity expressly assumes all of Franchisee's rights, duties, and obligations hereunder, whether accrued at the time of such assignment or arising thereafter, and the assignee agrees to be bound by all the terms and provisions of this Agreement to the same extent and in the same manner as Franchisee is. A copy of said instrument, executed by both Franchisee and said business entity must be delivered to Franchisor before the effective date of the transfer. Franchisee will not be able to maintain direct ownership and operation of the Franchised BHC Restaurants which Franchisee (or its Affiliated Entities) has developed after such assignment.
Source: Item 23 — Receipts (FDD pages 52–230)
What This Means (2025 FDD)
According to Bhc's 2025 Franchise Disclosure Document, a franchisee must provide the franchisor with at least 30 days prior written notice before assigning the franchise agreement to an Affiliated Entity. The entity must be organized to operate as a developer of Bhc restaurants and be entirely owned by the franchisee.
This notification period allows Bhc to assess the proposed transfer and ensure that the Affiliated Entity meets the necessary qualifications. Bhc also needs to provide written consent for the assignment to proceed. This consent process enables Bhc to maintain control over who operates its franchises and ensures brand consistency.
Furthermore, the assignment must be documented in a written instrument that is satisfactory to Bhc. This document must stipulate that the Affiliated Entity assumes all of the franchisee's obligations under the franchise agreement. The franchisee also cannot maintain direct ownership and operation of Bhc restaurants that the franchisee (or its Affiliated Entities) has developed after such assignment.