Besides legal requirements, what is the general rule regarding Bonchon disclosing the terms and conditions of the franchise agreement to unrelated third parties?
Bonchon Franchise · 2025 FDDAnswer from 2025 FDD Document
ncluding, but not limited to, their term, geographical area, and scope of activity to be restrained; (b) are designed to preclude competition which would be unfair to us; and (c) do not impose a greater restraint than is necessary to protect our goodwill and other legitimate business interests.
12.05 Procurement of Additional Covenants
You agree to require and obtain the execution of our Confidentiality/Non-Competition Agreement (Exhibit E) from all of the following persons:
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- Before employment or any promotion of your Operating Principal (if such individual has an ownership interest in you); and,
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- If you are a business entity, and as applicable, all of your owners, equity holders, control persons, shareholders, members, partners and general partner(s); all of your officers, directors and managers; and, all persons possessing equivalent positions in any business entity which directly or indirectly owns and/or controls you. You shall procure all such Confidentiality/Non-Competition Agreements no later than ten days following the Effective Date (or, if any individual or entity attains any status identified above after the Effective Date, within ten days following such individual or entity's attaining such status) and shall furnish to us copies of all executed Confidentiality/Non-Competition Agreements within ten days following their execution.
You agree to require and obtain the execution of our Confidentiality Agreement (Exhibit F) from your Operating Principal (if such individual does not hold an ownership interest in you), General Manager, Area Manager and all other managerial staff before their employment or promotion.
12.06 Your and Our Enforcement of Confidentiality/Non-Competition Agreements
You agree to vigorously and vigilantly prosecute to the fullest extent permitted by law breaches of any Confidentiality/Non-Competition Agreement executed by any of the individuals referenced in Section 12.05, and you acknowledge our right, to be exercised as we alone determine, to ourselves and enforce the terms of any such executed Confidentiality/Non-Competition Agreement.
Source: Item 23 — RECEIPTS (FDD pages 92–536)
What This Means (2025 FDD)
According to the 2025 Bonchon Franchise Disclosure Document, franchisees must ensure that certain individuals and entities execute a Confidentiality/Non-Competition Agreement or a Confidentiality Agreement. These individuals include the Operating Principal (if they have an ownership interest), owners, equity holders, control persons, shareholders, members, partners, general partners, officers, directors, managers, and individuals in equivalent positions within entities that own or control the franchisee. These agreements must be secured within ten days of the effective date or within ten days of an individual attaining a relevant status, with copies furnished to Bonchon.
Bonchon also requires franchisees to obtain a Confidentiality Agreement from their Operating Principal (if they do not hold an ownership interest), General Manager, Area Manager, and all other managerial staff before their employment or promotion. Franchisees are obligated to actively pursue legal action against any breaches of these agreements. Bonchon retains the right to independently enforce these confidentiality and non-competition agreements.
This means a Bonchon franchisee has a responsibility to ensure that anyone in a leadership or ownership position is bound by confidentiality and non-competition terms to protect Bonchon's interests. Failure to obtain these agreements or to enforce them could result in legal repercussions for the franchisee. This is a common practice in franchising to protect the brand's trade secrets and competitive advantages.