What is the required notice period before a Bhc Master Franchisee can assign and transfer the agreement to an Affiliated Entity?
Bhc Franchise · 2025 FDDAnswer from 2025 FDD Document
12.6 Transfers from Master Franchisee to an Affiliated Entity.
- (a) Upon not less than 30 days' prior written notice to Franchisor, Master 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 BHC Restaurants and (ii) entirely owned by Master Franchisee ("Affiliated Entity").
- (b) Any assignment and transfer by Master 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 Master 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 Master Franchisee is. A copy of said instrument, executed by both Master Franchisee and said business entity must be delivered to Franchisor before the effective date of the transfer. Master Franchisee will not be able to maintain direct ownership and operation of the BHC Restaurants which Master 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 Master Franchisee must provide the Franchisor with at least 30 days prior written notice before assigning and transferring the Master Franchise Agreement to an Affiliated Entity. This transfer is contingent upon the Franchisor's written consent. An Affiliated Entity is defined as an entity organized to operate as a developer of Bhc Restaurants and entirely owned by the Master Franchisee.
This requirement ensures that Bhc is informed well in advance of any changes in the ownership or operational structure of the Master Franchise. The 30-day notice period allows Bhc to assess the proposed Affiliated Entity and ensure it meets the necessary qualifications and standards. The Franchisor's consent is crucial, giving them control over who becomes involved in developing Bhc Restaurants under the Master Franchise Agreement.
Furthermore, the assignment and transfer must be documented in a written instrument acceptable to Bhc. This document must stipulate that the Affiliated Entity assumes all of the Master Franchisee's rights, duties, and obligations under the agreement. The Affiliated Entity must agree to be bound by all terms and provisions of the agreement to the same extent as the original Master Franchisee. This protects Bhc by ensuring the Affiliated Entity is fully accountable and committed to upholding the franchise agreement. The Master Franchisee cannot maintain direct ownership and operation of Bhc Restaurants after the assignment.