Under what circumstances is the MF Development Fee for a Bhc Master Franchise refundable?

According to Bhc's 2025 Franchise Disclosure Document, the MF Development Fee is generally non-refundable. The document explicitly states that upon signing the Master Franchise Agreement (MFA), the franchisee pays a lump sum, non-refundable MF Development Fee for each Master Franchised Bhc Restaurant to be opened under the MFA.

This fee covers the right to develop a specific territory and open a certain number of Bhc restaurants. The amount of the MF Development Fee will vary depending on the Development Area, the number of Master Franchised BHC Restaurants, and other special circumstances provided the MF Development Fee for each BHC Restaurants to be opened under the MFA shall not exceed then current Initial Franchise Fee.

The FDD is very clear that the MF Development Fee is non-refundable under any circumstances, even if the franchisee fails to open a Master Franchised Bhc Restaurant. This means that even if the franchisee is unable to secure locations, financing, or otherwise fails to meet the obligations to open the restaurants, the development fee will not be returned. This is a significant risk for potential Bhc master franchisees, as they must be prepared to lose this fee if they cannot fulfill the development agreement.

Given the non-refundable nature of the MF Development Fee, prospective Bhc master franchisees should conduct thorough due diligence before signing the MFA. This includes carefully evaluating the market potential of the development area, securing necessary financing, and developing a detailed business plan to ensure they can meet the development obligations. Franchisees should also seek legal and financial advice to fully understand the terms and conditions of the MFA and the risks associated with the non-refundable fee.