Under the Bhc franchise agreement, what is the franchisee licensed to use from the franchisor?
Bhc Franchise · 2025 FDDAnswer from 2025 FDD Document
pecialty retail items and promotional activities) are undertaken to develop, maintain and enhance the Marks and Franchisor's business reputation.
2.2 The Franchise System.
Franchisor has developed and supervises the System and all BHC retail locations to be operated under the Marks operated in accordance with the provisions of BHC franchise agreements and Franchisor's Operations Manual, as periodically amended.
3. GRANT OF FRANCHISE
3.1 Grant of Franchise.
- (a) By their respective signatures below, Franchisor hereby grants to Franchisee, and Franchisee hereby accepts, a non-exclusive license ("Franchise") to participate in and use the System to conduct the Franchised Business at the Franchised BHC Restaurant and within Franchisee's Territory as described in Exhibit 1 attached hereto, in strict accordance with this Agreement and the Operations Manual, from the Effective Date until the end of the term hereof, and any additional term unless sooner terminated. So long as Franchisee complies with this Agreement, Franchisor will not authorize another BHC franchisee to operate, or itself operate, a BHC retail Franchised BHC Restaurant in Franchisee's Territory, subject to exceptions and reservations provided herein.
- (b) Franchisor is executing this Agreement in reliance that the Principal Equity Operators and other individuals identified in Exhibit 2 of this Agreement are the sole holders of a legal or beneficial interest in Franchisee.
- (c) Each Principal Equity Operator (and their respective spouses, if applicable), must execute the Guarantee of Franchise Agreement attached as Exhibit 3 of this Agreement.
- (d) Franchisee acknowledges that Franchisor may have granted and may in the future operate or grant other licenses and franchises for other retail and wholesale food service businesses outside the Territory. FRANCHISEE MAY NOT USE FRANCHISOR'S MARKS, OPERATIONAL TECHNIQUES, SERVICE CONCEPTS OR PROPRIETARY INFORMATION IN CONNECTION WITH ANY BUSINESSES OR SERVICES OTHER THAN THE FRANCHISED BUSINESS CONDUCTED BY FRANCHISEE AT THE FRANCHISED BHC RESTAURANT WITHOUT FRANCHISOR'S EXPRESS PRIOR WRITTEN PERMISSION, WHICH PERMISSION, IF GRANTED, WILL BRING SUCH BUSINESSES OR SERVICES WITHIN THE SCOPE OF THE FRANCHISED BUSINESS AND SUBJECT REVENUES THEREFROM TO PAYMENT OF ROYALTY AND MARKETING AND PROMOTION FEES.
Source: Item 23 — Receipts (FDD pages 52–230)
What This Means (2025 FDD)
According to Bhc's 2025 Franchise Disclosure Document, franchisees are granted a non-exclusive license to participate in and use the Bhc System to conduct the Franchised Business at the Franchised BHC Restaurant within their designated territory. This license is valid from the effective date of the agreement until the end of the term, including any additional terms, provided the franchisee complies with the agreement and the Operations Manual.
The Bhc System, as defined in the FDD, includes distinctive signs, recipes, uniforms, trade secrets, confidential information, equipment specifications, layout plans, inventory, marketing techniques, a special design and color scheme of building, methods of inventory and operation control, bookkeeping and accounting procedures, and a manual of business practices and policies. Franchisees are also licensed to use the "BHC" and "BHC Chicken" trademarks and service marks.
Bhc retains ownership of the marks and associated goodwill. Franchisees' use of the marks is limited to the operation of the Franchised Business at the designated restaurant location and only for selling approved BHC Products and services. Franchisees cannot use Bhc's marks, operational techniques, service concepts, or proprietary information for any other business without prior written permission from Bhc, which, if granted, would bring those activities under the franchise agreement and subject them to royalty and marketing fees.