What is the consequence of violating the restrictions on the use of Confidential Information related to the Bonchon franchise?

According to Bonchon's 2025 Franchise Disclosure Document, violating the restrictions on the use of Confidential Information contained in the Franchise Agreement can lead to the termination of the agreement. Specifically, if a franchisee fails to comply with the restrictions pertaining to the use of Confidential Information, Bonchon has grounds to terminate the agreement.

This means that a Bonchon franchisee must be extremely careful to protect and properly use all confidential information provided by Bonchon. This includes, but is not limited to, information about the Bonchon System, products, services, equipment, technologies, recipes, preparation techniques, policies, standards, manuals, specifications, sources of supply, procedures, systems, techniques, pricing, and prospective sources of supply. The franchisee's obligation to protect this information extends both during the term of the Franchise Agreement and even after the agreement expires or terminates.

The restrictions on using confidential information are broad, and any unauthorized use or disclosure, even after the franchise agreement ends, could be considered a violation. This could have significant implications for a franchisee who wishes to operate a similar business after their Bonchon franchise agreement expires. Therefore, it is crucial for prospective franchisees to fully understand the scope of what Bonchon considers confidential information and the restrictions on its use, as violations can lead to termination of the franchise agreement.