What tangible costs will Bhc reimburse if a franchisee must modify or discontinue the use of a principal trademark?
Bhc Franchise · 2025 FDDAnswer from 2025 FDD Document
You must modify or discontinue the use of a principal trademark if we modify or discontinues it. If this happens, we will reimburse you for your tangible costs of compliance (for example, changing signs). You must not directly or indirectly contest our right to our trademarks, trade secrets or business techniques that are part of our business.
Source: Item 14 — Patents, Copyrights, And Proprietary Information (FDD pages 41–42)
What This Means (2025 FDD)
According to Bhc's 2025 Franchise Disclosure Document, if Bhc modifies or discontinues the use of a principal trademark, franchisees will be reimbursed for tangible costs of compliance. This reimbursement specifically covers expenses like changing signs to reflect the updated branding.
This provision offers some financial protection to franchisees in the event of a brand refresh or change initiated by Bhc. While the reimbursement is limited to tangible costs, it can still significantly offset expenses associated with updating the restaurant's physical appearance to align with the new trademark. Franchisees should clarify with Bhc what specific expenses are considered "tangible costs" to ensure a clear understanding of what will be covered.
It is important to note that this reimbursement is contingent upon Bhc initiating the change to the trademark. If a franchisee independently decides to modify their signage or branding, they would likely not be eligible for reimbursement. Franchisees should also be aware that the reimbursement only applies to "principal trademarks," so it's important to understand which marks are considered principal trademarks under the franchise agreement.