Under what circumstances is a Bhc Master Franchisee required to reimburse the Franchisor for collection costs?

According to Bhc's 2025 Franchise Disclosure Document, a Master Franchisee is required to reimburse Bhc for all costs incurred by Bhc to enforce its rights under the Master Franchise Agreement. These costs include reasonable attorneys' fees and investigator's fees. This reimbursement is required upon Bhc's demand and includes actions taken to collect any amounts due and delinquent under the agreement.

This means that if a Master Franchisee fails to meet their financial obligations or violates any other terms of the agreement, Bhc can take legal action to enforce its rights. The Master Franchisee would then be responsible for covering Bhc's expenses in pursuing such legal action, including legal and investigation fees.

This provision is standard in franchise agreements, as it protects the franchisor's interests and ensures that franchisees comply with the terms of the agreement. It also incentivizes Master Franchisees to resolve disputes and meet their obligations promptly to avoid incurring additional costs. A prospective franchisee should carefully consider this clause and ensure they have sufficient financial resources to cover potential collection costs in case of a dispute or breach of contract.