Under what condition can the Bhc Franchisor elect not to be bound by the terms of any Amendment to the Lease?
Bhc Franchise · 2025 FDDAnswer from 2025 FDD Document
Franchisor shall pay, perform, and be bound by all the duties and obligations of the Lease applicable to Tenant, except that the Franchisor may elect not to assume or be bound by the terms of any Amendment to the Lease executed by Tenant without obtaining Franchisor's prior written approval, which shall not be unreasonably withheld or delayed.
Source: Item 23 — Receipts (FDD pages 52–230)
What This Means (2025 FDD)
According to Bhc's 2025 Franchise Disclosure Document, when Bhc assumes a tenant's (franchisee's) interest in a lease, Bhc has the option to not be bound by any amendments to the lease that the tenant executed without first obtaining Bhc's written approval. However, Bhc cannot unreasonably withhold or delay such approval. This provision is found within Item 23, which discusses various aspects of receipts related to the franchise agreement.
For a prospective Bhc franchisee, this clause offers a degree of protection. It prevents a franchisee from making lease amendments that could negatively impact Bhc if Bhc were to assume the lease due to the franchisee's default or termination of the franchise agreement. This ensures that Bhc has control over the lease terms it inherits.
This condition is fairly standard in franchising, particularly when the franchisor has the right to assume the lease. It allows Bhc to maintain brand standards and operational consistency across all locations, even those it takes over from a former franchisee. Franchisees should be aware of this provision and ensure they obtain written approval from Bhc before agreeing to any lease amendments to avoid potential conflicts or complications.