Does the Bonchon agreement confer any right to participate in or benefit from other business activities engaged in by Bonchon or its affiliates?
Bonchon Franchise · 2025 FDDAnswer from 2025 FDD Document
You agree that we and/or our affiliates may engage in any business activity whatsoever in or outside the Development Territory except as we are restricted by Section 3.02 of this Agreement, and that this Agreement does not confer upon you any right to participate in or benefit from any such other business activity (regardless of whether it is conducted under the Proprietary Marks or not). Our rights to engage in other business activities are specifically reserved and may not be qualified or diminished in any way by implication. We thus may engage in, or authorize others to engage in, any form of business offering and selling any type of product or service except as we are restricted by Section 3.02 of this Agreement. By way of example, we and/or our affiliates may own, operate or authorize others to own or operate any type of business at any location we choose, including within your Development Territory, so long as such other business does not sell under the Proprietary Marks the type of products or services which your Bonchon Businesses offer and sell (except as permitted below). Further, we and/or our affiliates may own, operate or authorize others to own or operate Bonchon Businesses at any location outside of your Development Territory (including immediately proximate thereto).
Source: Item 23 — RECEIPTS (FDD pages 92–536)
What This Means (2025 FDD)
According to Bonchon's 2025 Franchise Disclosure Document, the franchise agreement does not confer any right to participate in or benefit from other business activities engaged in by Bonchon or its affiliates. Bonchon and its affiliates reserve the right to engage in any business activity, whether inside or outside the Development Territory, except as restricted by Section 3.02 of the agreement. This means Bonchon can operate or authorize others to operate any type of business, including those within a franchisee's Development Territory, as long as they do not sell the same products or services under the Bonchon trademarks, with some exceptions.
Bonchon retains the right to sell Bonchon products and services to national, regional, and institutional accounts both within and outside the Development Territory. These accounts are defined as customers whose presence extends beyond the franchisee's territory, such as business entities with multiple locations or government agencies. Bonchon also has the exclusive right to offer and sell products or services through alternate channels of distribution, such as the internet, mail order, or telemarketing, without providing any compensation to the franchisee for sales within their territory.
Furthermore, Bonchon can establish Bonchon businesses, kiosks, or mobile units at nontraditional locations, including those within a franchisee's Development Territory, such as sports arenas, malls, or airports. Franchisees will not receive any compensation for sales made at these nontraditional locations. These stipulations clarify that the franchisee's rights are limited to the operation of a traditional Bonchon restaurant within their defined territory and do not extend to other business activities or alternative distribution channels utilized by Bonchon or its affiliates.