Does the general release required for renewal, sale, or assignment/transfer of a Bonchon franchise apply to liability under the Maryland Franchise Registration and Disclosure Law?
Bonchon Franchise · 2025 FDDAnswer from 2025 FDD Document
ITEM 17. RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION
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- The general release required as a condition of renewal, sale, and/or assignment/transfer shall not apply to any liability under the Maryland Franchise Registration and Disclosure Law.
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- The laws of the State of Maryland may supersede the Franchise Agreement, including the areas of termination and renewal of the Franchise.
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- A franchisee may sue in Maryland for claims arising under the Maryland Franchise Registration and Disclosure Law. Any claims arising under the Maryland Franchise Registration and Disclosure Laws must be brought within three years after the grant of the Franchise.
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- The provision of the Franchise Agreement that provides for termination upon your bankruptcy may not be enforceable under federal bankruptcy law (11 U.S.C. Section 101 et seq.).
Source: Item 23 — RECEIPTS (FDD pages 92–536)
What This Means (2025 FDD)
According to Bonchon's 2025 Franchise Disclosure Document, the general release required as a condition of renewal, sale, and/or assignment/transfer of a Bonchon franchise does not apply to any liability under the Maryland Franchise Registration and Disclosure Law. This protection is specifically outlined in the Maryland Addendum to the Disclosure Document. This addendum ensures that franchisees in Maryland retain their rights and protections under Maryland franchise law, regardless of any general releases they may sign during the renewal, sale, or transfer of their franchise.
This provision is significant for prospective Bonchon franchisees in Maryland because it prevents Bonchon from using a general release to waive the franchisee's rights under Maryland's franchise laws. These laws are designed to protect franchisees from unfair practices by franchisors, and this clause ensures that Maryland franchisees can still pursue claims under these laws if necessary. The Maryland Addendum explicitly states that these waivers and releases are not intended to, nor will they act as a release, estoppel, or waiver of any liability incurred under the Maryland Franchise Registration and Disclosure Law, further reinforcing this protection.
Furthermore, the Maryland Addendum includes additional protections for franchisees, such as allowing franchisees to sue in Maryland for claims arising under the Maryland Franchise Registration and Disclosure Law and specifying that any such claims must be brought within three years after the grant of the Franchise. These provisions collectively strengthen the legal standing of Bonchon franchisees in Maryland and provide a more balanced relationship between the franchisor and franchisee within the state.
In summary, the Maryland Addendum to the Bonchon Franchise Disclosure Document provides critical safeguards for franchisees operating in Maryland, ensuring that their rights under the Maryland Franchise Registration and Disclosure Law are fully protected during the franchise lifecycle.