If I haven't suggested a Restaurant Location approved before executing the Bonchon franchise agreement, what provisions apply?
Bonchon Franchise · 2025 FDDAnswer from 2025 FDD Document
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.
You understand that any advice we furnish regarding site selection and our proposal, inspection and/or approval of any proposed site for your Restaurant Location will not constitute, and will not be deemed to constitute, our express or implied representation, warranty, guarantee or any other indication of the prospective profitability, viability or merit of the Restaurant Location.
Source: Item 23 — RECEIPTS (FDD pages 92–536)
What This Means (2025 FDD)
According to Bonchon's 2025 Franchise Disclosure Document, securing an approved restaurant location within specified timeframes is crucial after the franchise agreement's effective date. For a standard Bonchon Restaurant, you must select a location and receive written approval within 90 days of the agreement's effective date. Following approval, you have 120 days to sign a lease approved by Bonchon or provide proof of ownership. For a Remote Kitchen Restaurant, these timelines are shorter: location selection and approval within 60 days, and lease signing or proof of ownership within 90 days.
Failure to meet these deadlines constitutes a material breach of the franchise agreement. Unless Bonchon waives the breach, they can terminate the agreement immediately upon notice, without allowing you an opportunity to rectify the situation. If Bonchon terminates the agreement due to your failure to secure a location, you will not receive a refund of any portion of the initial franchise fee, as the funds will be considered earned by Bonchon. Additionally, you must execute a general release form in favor of Bonchon and its affiliates.
Furthermore, Bonchon has the right to terminate the agreement if you and Bonchon cannot agree on a restaurant location within the initial 90-day (or 60-day for Remote Kitchen Restaurants) timeframe. In this scenario, similar to failing to secure a location, you will not receive a refund of the initial franchise fee, and you must execute a general release. Bonchon emphasizes that any advice or approval regarding site selection does not constitute a guarantee of the location's profitability or viability. Therefore, it is important to conduct thorough due diligence on any proposed location.