Under what conditions is the initial deposit refundable to the Master Franchisee after the expiration or termination of the Bhc Master Franchise Agreement?
Bhc Franchise · 2025 FDDAnswer from 2025 FDD Document
and payable in full, by cashier's check or money order or wire transfer to Franchisor when Master Franchisee signs this Agreement. The Initial Franchise Fee is fully earned by Franchisor when paid.
4.2 Initial Deposit.
When Master Franchisee signs this Agreement, Master Franchisee must pay Franchisor USD Twenty Thousand (USD $20,000) per BHC Restaurant as a deposit fee (the "Deposit"). Deposit is due and payable in full, by cashier's check or money order or wire transfer to Franchisor when Master Franchisee signs this Agreement. The purpose of the Deposit is to secure against non-payment of Master Franchisee's obligations under this Agreement. The Deposit must be paid in a lump sum and is refundable within sixty (60) days of the expiration or termination of this Agreement if and only if Master Franchisee is in full compliance with Master Franchisee's obligations in this Agreement, including, without limitation, Master Franchisee's post termination obligations set forth in section 11.2 and 15.1 thereof. If any amount is deducted from the Deposit b
Source: Item 23 — Receipts (FDD pages 52–230)
What This Means (2025 FDD)
According to Bhc's 2025 Franchise Disclosure Document, the initial deposit paid by the Master Franchisee is refundable under specific conditions. When the Master Franchisee signs the agreement, they must pay Bhc a deposit of $20,000 per BHC Restaurant. This deposit secures the Master Franchisee's obligations under the agreement.
The deposit is refundable within sixty days of the expiration or termination of the agreement. However, this refund is contingent upon the Master Franchisee being in full compliance with all obligations outlined in the agreement. This includes, but is not limited to, the post-termination obligations detailed in sections 11.2 and 15.1 of the agreement.
If Bhc deducts any amount from the initial deposit during the term of the agreement, the Master Franchisee is responsible for replenishing the deposit to maintain the full $20,000 per restaurant within ten business days of the deduction. This ensures that the deposit remains at the agreed-upon level throughout the duration of the Master Franchise Agreement.