In the Bonchon Franchise Agreement, what does 'Effective Date' refer to?
Bonchon Franchise · 2025 FDDAnswer from 2025 FDD Document
te its suitability. If you request that we visit the proposed Restaurant Location, the first visit will be free of cost, with any subsequent visits costing $500 per day plus the cost of our travel expenses.
It is of the essence of this Agreement that you select a Restaurant Location and obtain our advance written approval for your Restaurant Location within 90 days following the Effective Date of this Agreement and that you sign a lease approved by us (or provide proof of ownership or an executed contract of sale) for your Restaurant Location within 120 days following the Effective Date of this Agreement. If you will be operating a Remote Kitchen Restaurant, then you must select a Restaurant Location and obtain our advance written approval for your Restaurant Location within 60 days following the Effective Date of this Agreement and that you sign a lease approved by us (or provide proof of ownership or an executed contract of sale) for your Restaurant Location within 90 days following the Effective Date of this Agreement. If you do not secure a Restaurant Location within the time limits and following the procedures specified in this Section 6.01, then this failure will be a material and incurable breach of this Agreement which, unless we waive the breach, will entitle us to terminate this Agreement immediately upon notice to you, with no opportunity to cure. If we terminate the Agreement for this reason, then all funds you paid us will be considered earned by us; we will not refund to you any portion of the Initial Franchise Fee; and you shall immediately execute our then-current form of General Release running in favor of us and our affiliates.
In addition, if you and we cannot agree upon a Restaurant Location within 90 days following the Effective Date (or 60 days following the Effective Date, if you will be operating a Remote Kitchen Restaurant), then we can terminate this Agreement. If we elect to terminate this Agreement, then we will not refund any portion of the Initial Franchise Fee, and you shall immediately execute our thencurrent form of General Release running in favor of us and our affiliates. You will not be entitled to a refund of your Initial Franchise Fee.
Source: Item 23 — RECEIPTS (FDD pages 92–536)
What This Means (2025 FDD)
According to Bonchon's 2025 Franchise Disclosure Document, the 'Effective Date' in the Franchise Agreement is a critical starting point for several key deadlines and obligations for the franchisee.
Specifically, the franchisee has 90 days from the Effective Date to select a restaurant location and secure Bonchon's written approval. For a Remote Kitchen Restaurant, this timeline is shorter, at 60 days. Following location approval, the franchisee then has 120 days from the Effective Date (90 days for Remote Kitchens) to sign a lease approved by Bonchon or provide proof of ownership. Failure to meet these deadlines constitutes a material breach of the agreement, potentially leading to termination by Bonchon.
Furthermore, the franchisee must open their Bonchon Restaurant for business within 300 days after the Effective Date, or by the Scheduled Opening Date specified in Exhibit A, whichever comes first. For Remote Kitchen Restaurants, this period is reduced to 210 days. Missing this deadline also allows Bonchon to terminate the agreement without providing an opportunity to cure the breach. These timelines underscore the importance of swift action and diligent planning once the Franchise Agreement is signed.