Besides the restrictions in Section 3.02, can Bonchon engage in any business activity, including using its Proprietary Marks, even within a franchisee's Protected Territory?
Bonchon Franchise · 2025 FDDAnswer from 2025 FDD Document
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 whatsoever, including within your Protected Territory, so long as the other business does not sell under the Proprietary Marks the type of products or services which your franchised Bonchon Business offers and sells, except as permitted below. Further, we and/or our affiliates may own, operate or authorize others to own or operate Businesses at any location outside of your Territory, including immediately proximate to your Protected Territory. You will receive no compensation for these businesses' sales.
In addition, you understand and agree that we and/or our affiliates alone have the right to offer and sell anywhere (including within and outside your Protected Territory), under the Proprietary Marks, any and all products or services and/or their components or ingredients (including those used or sold by your franchised Bonchon Business), through any alternative method of distribution other than a Bonchon Business situated within your Protected Territory, including, without limitation, such alternative channels of distribution as the internet/worldwide web; any other form of electronic commerce; "800" or similar toll-free telephone numbers; supermarkets, grocery stores and convenience stores; mail order; catalogs; telemarketing or other direct marketing sales; television sales (including "infomercials"); food trucks; take-away premises; online networks; other permanent temporary or seasonal food service facilities; or, any other channel of distribution whatsoever except for a Bonchon Restaurant in your Protected Territory. You will receive no compensation for our or our affiliates' sales through alternative distribution channels.
You also understand and agree that we and/or our affiliates alone have the right to offer and sell (directly, or through other franchisees or licensees) Bonchon System products and services at any and all Nontraditional Locations, including Nontraditional Locations situated in your Protected Territory, through the establishment of Bonchon Restaurants, kiosks, mobile units, concessions or shop in shops. "Nontraditional Locations" include sports arenas and venues; theatres; resorts; food retailers (including supermarkets, grocery stores and convenience stores); malls and mall food courts; schools and universities; hospital and healthcare facilities; airports; guest lodging facilities; day care facilities of any type; government facilities; condominium and cooperative complexes; the premises of any third party retailer which is not a restaurant (including shops, stores and department
Source: Item 23 — RECEIPTS (FDD pages 92–536)
What This Means (2025 FDD)
According to Bonchon's 2025 Franchise Disclosure Document, Bonchon and its affiliates retain broad rights to conduct business activities, even within a franchisee's protected territory, subject to certain restrictions outlined in Section 3.02 of the franchise agreement. Specifically, Bonchon can operate or authorize others to operate businesses within a franchisee's protected territory, provided these businesses do not sell products or services under Bonchon's Proprietary Marks that are the same type offered by the franchisee's Bonchon restaurant. This allowance is subject to certain exceptions.
Bonchon also retains the right to sell products and services, including those sold by the franchisee, under the Proprietary Marks through alternative distribution channels, such as the internet, electronic commerce, toll-free numbers, supermarkets, mail order, catalogs, telemarketing, television sales, food trucks, online networks, and other food service facilities, regardless of whether these channels operate within or outside the franchisee's protected territory. The franchisee will not receive any compensation for sales made through these alternative distribution channels.
Furthermore, Bonchon has the right to offer and sell Bonchon System products and services at nontraditional locations, including those within a franchisee's protected territory. These nontraditional locations include venues like sports arenas, theaters, resorts, food retailers, malls, schools, hospitals, airports, lodging facilities, and government facilities. These rights collectively allow Bonchon to diversify its revenue streams and market presence, potentially impacting the franchisee's market share within their protected territory. A prospective franchisee should carefully consider the implications of these retained rights and how they might affect the profitability and competitive landscape of their Bonchon franchise.