Is Bhc required to post a bond or other security to obtain equitable relief for a breach of confidentiality or non-competition by a franchisee?
Bhc Franchise · 2025 FDDAnswer from 2025 FDD Document
Franchisee further agrees that a breach of the confidentiality and non-competition covenants set forth above and, in the Confidentiality, and Non-Competition Agreement (see Exhibit 4 to this Franchise Agreement) will cause immediate and irreparable damage to Franchisor that would be impossible or inadequate to measure and calculate and could not be fully remedied by monetary damages.
Accordingly, Franchisor has the right to specifically enforce this Agreement and seek injunctive or other equitable relief as may be necessary or appropriate to prevent such breach or continued breach without the necessity of proving actual damages by reason of any such breach or threatened breach of this Agreement.
Franchisee further agrees that no bond or other security will be required in obtaining such equitable relief and hereby consents to the issuance of such injunction and to the ordering of specific performance.
Franchisee further acknowledges that such remedies are in addition to any other rights or remedies, whether at law or in equity, which may be available to Franchisor, including monetary damages.
Source: Item 23 — Receipts (FDD pages 52–230)
What This Means (2025 FDD)
According to Bhc's 2025 Franchise Disclosure Document, Bhc is not required to post a bond or other security to obtain equitable relief for a breach of confidentiality or non-competition by a franchisee. The franchise agreement states that a breach of confidentiality and non-competition covenants will cause immediate and irreparable damage to Bhc, which cannot be adequately remedied by monetary damages alone.
Therefore, Bhc has the right to enforce the agreement and seek injunctive or other equitable relief to prevent breaches without having to prove actual damages. The franchisee specifically agrees that no bond or other security will be required for Bhc to obtain such equitable relief and consents to the issuance of an injunction or specific performance order.
This provision is favorable to Bhc, as it streamlines the process of obtaining injunctive relief against a franchisee who violates confidentiality or non-competition agreements. It removes a potential hurdle (posting a bond) that could delay or complicate Bhc's ability to protect its interests. For a prospective franchisee, this means they should be fully aware of and prepared to adhere to the confidentiality and non-competition covenants, as Bhc can quickly seek legal remedies without the need for a bond.