Must the Subfranchise Agreement for Bhc be in a form approved by the Franchisor?
Bhc Franchise · 2025 FDDAnswer from 2025 FDD Document
- (b) Once a Subfranchisee and a potential BHC Restaurant have been approved pursuant to the approval process described in paragraph 2(b), Master Franchisee shall enter into a Subfranchise Agreement in relation to the relevant approved BHC Restaurant with the relevant Subfranchisee in the form approved by Franchisor, including only such amendments to such form as approved by Franchisor in writing (such executed agreement, "Subfranchise Agreement").
Prior to entering into any form Subfranchise Agreement or any other form agreements, including an area development agreement or lease addendum (collectively, "Other Agreements"), for the first time with a prospective subfranchisee or Subfranchisee, Master Franchisee shall submit to and receive Franchisor's approval of such proposed form Subfranchise Agreement or Other Agreement.
In addition, once a form Subfranchise Agreement or Other Agreement has been approved, Master Franchisee shall not modify the terms of such form documents without submitting to and receiving Franchisor's prior written approval of such modified form documents.
Master Franchisee's form Subfranchise Agreement and Other Agreements shall include terms and conditions consistent with this Agreement and as prescribed by Franchisor from time to time, including the maximum size of the territory granted under any Subfranchise Agreement or Other Agreement.
Executed copies of each Subfranchise Agreement and any related Other Agreements shall be sent to Franchisor before the opening of the relevant approved BHC Restaurant for Franchisor's records.
Executed copies of any Other Agreements Master Franchisee enters into with Subfranchisees shall be sent to Franchisor within thirty (30) days of the date of execution.
Source: Item 23 — Receipts (FDD pages 52–230)
What This Means (2025 FDD)
According to Bhc's 2025 Franchise Disclosure Document, the Subfranchise Agreement must be in a form approved by Bhc. Specifically, after a subfranchisee and BHC Restaurant are approved, the Master Franchisee is required to enter into a Subfranchise Agreement with the subfranchisee. This agreement must be in the form approved by Bhc, and any amendments to this form must also be approved by Bhc in writing.
Prior to entering into any Subfranchise Agreement or other agreements like area development agreements or lease addenda, the Master Franchisee must submit the proposed form to Bhc for approval. Furthermore, once a form Subfranchise Agreement or Other Agreement has been approved, the Master Franchisee cannot modify the terms without obtaining Bhc's prior written approval.
The Subfranchise Agreement and Other Agreements used by the Master Franchisee must include terms and conditions consistent with the Master Franchise Agreement and as prescribed by Bhc. This includes stipulations like the maximum territory size granted under any Subfranchise Agreement. Executed copies of each Subfranchise Agreement and any related Other Agreements must be sent to Bhc before the opening of the relevant approved BHC Restaurant for their records, and copies of any Other Agreements must be sent within thirty days of execution.