In Michigan, what constitutes 'good cause' for Bonchon to terminate a franchise agreement before its expiration?
Bonchon Franchise · 2025 FDDAnswer from 2025 FDD Document
- (c) A provision that permits franchisor to terminate a franchise prior to the expiration of its term except for good cause.
Good cause shall include the failure of the franchisee to comply with any lawful provision of the franchise agreement and to cure such failure after being given written notice thereof and a reasonably opportunity, which in no event need be more than 30 days, to cure such failure.
Source: Item 23 — RECEIPTS (FDD pages 92–536)
What This Means (2025 FDD)
According to the 2025 Bonchon Franchise Disclosure Document, in Michigan, 'good cause' for termination includes the franchisee's failure to comply with any lawful provision of the franchise agreement. To trigger termination, Bonchon must provide the franchisee with written notice of the failure and a reasonable opportunity to correct it.
The FDD specifies that the cure period need not exceed 30 days. This means a Bonchon franchisee in Michigan has a limited time to rectify any violations of the franchise agreement after receiving notice from Bonchon. Failure to cure within this timeframe allows Bonchon to terminate the agreement.
This provision is typical in franchising, as it balances the franchisor's need to maintain brand standards and protect the system with the franchisee's investment and right to operate. The 'good cause' standard and cure period requirement offer some protection to franchisees against arbitrary termination, but it's crucial for prospective Bonchon franchisees in Michigan to understand their obligations under the franchise agreement and ensure compliance to avoid potential termination.