What are the potential liabilities for Bonchon if its representative is not properly authorized?
Bonchon Franchise · 2025 FDDAnswer from 2025 FDD Document
re critically important to you, us and all other franchisees, since your failure to adhere to the System, this Agreement, the Manuals and any Supplements to the Manuals may damage the reputation and goodwill enjoyed by
the Bonchon network and the Proprietary Marks.
8.03 Modifications to the Bonchon System
In the exercise of our sole business judgment, we may from time to time modify any components of the Bonchon System and requirements applicable to you by means of Supplements to the Manuals or otherwise, including, but not limited to, altering the products, services, programs, methods, standards, accounting and computer systems, forms, policies and procedures of the Bonchon System; adding to, deleting from or modifying the products and services which your franchised Business is authorized and required to offer; modifying or substituting the equipment, signs, trade dress and other Restaurant characteristics that you are required to adhere to (subject to the limitations set forth in this Agreement); requirements pertaining to capturing and relaying to us customer information and data; and, changing, improving, modifying or substituting for the Proprietary Marks. For example, we may require you to institute drive-through and/or delivery services at and/or from your Restaurant. If you are operating a Remote Kitchen Restaurant, we may require that you comply with operating standards different from those we prescribe for Dine-In, Fast Casual and Delivery and Carryout Only Restaurants (subject to any restrictions, imposed on you by the lease agreement, occupancy agreement, or other agreement under which you have the right to possess and operate the Bonchon Business at the Remote Kitchen location), including, without limitation, (i) implementing different hours of operation; and (ii) using vendors and/or paying for technologies and services that are not standard for Dine-In, Fast Casual and Delivery and Carryout Restaurants. You agree to implement any such System modifications as if they were part of the System at the time you signed this Agreement.
You acknowledge that because uniformity under many varying conditions may not be possible or practical, we reserve the right to materially vary our standards or franchise agreement terms for any franchised Bonchon Business, based on the timing of the grant of the franchise, the peculiarities of the particular territory or circumstances, business potential, population, existing business practices, other non-arbitrary distinctions or any other condition which we consider important to the successful operation of the franchised Bonchon Business. You will have no right to require us to disclose any variation or to grant the same or a similar variation to you.
8.04 Cobranding
We may determine from time to time to incorporate in the Bonchon System products or services which we either develop or otherwise obtain rights to, which are offered and sold under names, trademarks and/or service marks other than the Proprietary Marks and which your Bonchon Business, along with other Bonchon Businesses, will be required to offer and sell. This activity, referred to as "cobranding", may involve changes to the Proprietary Marks and may require you to make modifications to your Restaurant's building and premises and the furniture, fixtures, equipment, signs and trade dress of your Restaurant. If you receive written notice that we are instituting a cobranding program, you agree promptly to implement that program at your Bonchon Restaurant at the earliest commercially reasonable time and to execute any and all instruments required to do so.
Source: Item 23 — RECEIPTS (FDD pages 92–536)
What This Means (2025 FDD)
Based on the 2025 Franchise Disclosure Document, if a Bonchon representative acts without proper authorization, the franchisee could face several repercussions. Bonchon retains the right to modify the Bonchon System, which includes altering products, services, standards, and even the Proprietary Marks. Franchisees are obligated to implement these changes as if they were part of the original agreement. This means an unauthorized representative could make changes that the franchisee is then bound to implement, potentially at their own cost.
Bonchon also reserves the right to vary its standards or franchise agreement terms based on various factors, including the timing of the franchise grant and the specific circumstances of the territory. Franchisees do not have the right to demand disclosure of these variations or to receive similar variations themselves. Therefore, actions taken by an unauthorized representative could lead to the franchisee being held to different standards without their knowledge or consent.
Furthermore, the FDD outlines various scenarios where a franchisee's actions or inactions can lead to termination of the agreement. These include non-compliance with laws, repeated failure to comply with the Franchise Agreement, and any act that impairs the goodwill associated with Bonchon's Proprietary Marks. An unauthorized representative's actions could potentially trigger these termination clauses, resulting in the franchisee losing their rights to operate under the Bonchon brand and use its Proprietary Marks. Upon termination, the franchisee must cease using the Proprietary Marks, discontinue operating as a Bonchon business, and take action to cancel any assumed name registrations containing the Bonchon mark.