In the Bonchon Franchise Agreement, what happens if there is a conflict between a provision of the agreement and a present or future statute, law, ordinance, or regulation?
Bonchon Franchise · 2025 FDDAnswer from 2025 FDD Document
If any valid, applicable law or regulation of a competent governmental authority with jurisdiction over this Agreement or the parties to this Agreement limits our rights of termination under this Agreement or requires longer notice or cure periods than those set forth above, then this Agreement will be considered modified to conform to the minimum notice, cure periods or restrictions upon termination required by the laws and regulations. We will not, however, be precluded from contesting the validity, enforceability or application of the laws or regulations in any action, proceeding, hearing or dispute relating to this Agreement or the termination of this Agreement.
Source: Item 23 — RECEIPTS (FDD pages 92–536)
What This Means (2025 FDD)
According to Bonchon's 2025 Franchise Disclosure Document, Section 15.06 addresses conflicts between the Franchise Agreement and applicable laws or regulations. If a valid law or regulation from a competent governmental authority limits Bonchon's termination rights or requires longer notice or cure periods than those specified in the agreement, the agreement will be modified to conform to the minimum requirements of the law or regulation. However, Bonchon retains the right to contest the validity, enforceability, or application of such laws or regulations in any legal action or dispute related to the agreement or its termination.
This provision ensures that Bonchon franchisees are protected by the minimum standards established by applicable laws and regulations, particularly concerning termination rights and notice periods. It prevents Bonchon from enforcing terms in the Franchise Agreement that are less favorable to the franchisee than what is legally mandated.
However, it's important to note that Bonchon reserves the right to challenge the validity or applicability of any such laws or regulations. This means that while the agreement will initially be modified to comply with the law, Bonchon may still pursue legal action to argue against the law's application or validity. Franchisees should be aware of this possibility and understand that legal disputes could arise regarding the interpretation and enforcement of these laws and regulations. This clause provides a balance, ensuring legal compliance while preserving Bonchon's ability to challenge regulations it deems inappropriate or incorrectly applied.