When establishing a Bonchon franchise, what details about the business entity owners must be disclosed?
Bonchon Franchise · 2025 FDDAnswer from 2025 FDD Document
If you are a corporation, limited liability company, limited partnership or any other type of business entity, you must comply with the following requirements (which will also apply to any assignee of this Agreement which is a business entity):
- A. Furnish us with all of your formation, organizational and governing documents; a schedule of all current owners (indicating as to each its percentage ownership interest) in the form annexed hereto as Exhibit J; any shareholder, partnership, membership, buy/sell or equivalent agreements and documents; and, a list of all of your officers, directors and managers (as applicable).
- B. Unless we otherwise consent in writing, your business entity's formation and governing documents must provide that its activities will be confined exclusively to the operation of the franchised Business.
- C. You must promptly notify us in writing of any change in any of the information specified, or in any document referred to, herein.
Source: Item 23 — RECEIPTS (FDD pages 92–536)
What This Means (2025 FDD)
According to Bonchon's 2025 Franchise Disclosure Document, if a franchisee is a business entity, they must furnish Bonchon with several details regarding the entity's owners. Specifically, Bonchon requires the franchisee to provide all formation, organizational, and governing documents of the business entity. This includes any shareholder, partnership, membership, buy/sell, or equivalent agreements and documents.
Bonchon also requires a current list of all owners of record and all beneficial owners of any class of capital stock, general or limited partnership interests, membership interests, or similar interests. This list must be furnished to Bonchon upon request. Furthermore, the franchisee must promptly notify Bonchon in writing of any changes to the information provided in these documents.
These requirements ensure that Bonchon has complete transparency regarding the ownership and control of its franchisees, especially when the franchisee is a business entity. This allows Bonchon to assess potential risks and maintain the integrity of its franchise system. Additionally, Bonchon needs to be kept up to date on any changes to the ownership or governing documents of the business entity.