What are the two options Bhc franchisees have for renewing their franchise agreement?
Bhc Franchise · 2025 FDDAnswer from 2025 FDD Document
renew the Franchise Agreement;
- (iv) Franchisor withdraws from distributing its products or services through Franchises in the geographic market served by Franchisee.
- (v) At the time of renewal, Franchisee or any Principal Equity Operator has been convicted of a felony or a crime involving moral turpitude, consumer fraud or any other offense
that is reasonably likely, in Franchisor's judgment, to have a materially adverse effect on the Marks, the System, or the goodwill associated with the Marks or System; or
- (d) As a condition to renewing Franchisee's rights, duties and obligations hereunder, not later than 90 days before the end of the term that is expiring, Franchisee and Franchisor must sign either (i) Franchisor's then-current standard Franchise Agreement modified by addendum to remove provisions that only apply to a new franchisee, such as initial franchise fee and initial training requirements ("Renewal Franchise Agreement") or (ii) an addendum to this Agreement extending its term for an additional 10 year term. IN ADDITION TO NOT GRANTING ANY ADDITIONAL RIGHTS BEYOND THOSE GRANTED IN THIS AGREEMENT, THE RENEWAL FRANCHISE AGREEMENT MAY CONTAIN OTHER TERMS THAT ARE SUBSTANTIALLY DIFFERENT FROM THOSE IN THIS AGREEMENT. The Renewal Franchise Agreement, when executed, will supersede this Agreement.
- (e) At the time of renewal, Franchisee must have satisfied all monetary obligations owed by Franchisee to Franchisor and to Franchisor's affiliates and all other material obligations under this Agreement, and Franchisor may examine Franchisee's books and records to verify compliance with this requirement anytime during normal business hours within 120 days of Franchisee's renewal date.
- (f) Before or not later than 90 days after Franchisee's execution of a Renewal Franchise Agreement for an additional term, Franchisee must make such physical modifications (i.e., remodel) to Franch
Source: Item 23 — Receipts (FDD pages 52–230)
What This Means (2025 FDD)
According to Bhc's 2025 Franchise Disclosure Document, a franchisee has two options when renewing their franchise agreement. At least 90 days before the current term expires, the franchisee and Bhc can either sign Bhc's then-current standard franchise agreement, modified to remove terms only applicable to new franchisees, or sign an addendum to the existing agreement extending the term for an additional 10 years.
It is important to note that the renewal franchise agreement may contain terms substantially different from the original agreement, and it will supersede the original agreement upon execution. Before or up to 90 days after executing a renewal franchise agreement, the franchisee must also make any necessary physical modifications to the restaurant to align with current trade dress and system requirements, and to accommodate any new Bhc products.
Additionally, the franchisee must have met all monetary and material obligations under the existing agreement at the time of renewal. Bhc has the right to examine the franchisee's books and records to verify compliance within 120 days of the renewal date. When the franchisee signs the renewal franchise agreement, they must pay Bhc a renewal fee of $40,000.