Regarding Bonchon franchises, can a franchisee waive claims under applicable state franchise law, including fraud in the inducement, through any statement, questionnaire, or acknowledgment signed in connection with the franchise relationship?

According to Bonchon's 2025 Franchise Disclosure Document, a franchisee cannot waive claims under applicable state franchise law, including fraud in the inducement, through any statement, questionnaire, or acknowledgment signed when starting the franchise relationship. This protection is highlighted in several addenda to the disclosure document, reinforcing that this provision supersedes any other conflicting terms in documents related to the franchise agreement. This ensures that franchisees retain their legal rights and protections under state franchise laws, regardless of any agreements or acknowledgments made during the initial phase of the franchise. This applies specifically in the states of California, Hawaii, Illinois, Indiana, Maryland, North Dakota, and Rhode Island.

For prospective Bonchon franchisees, this means that any document they sign during the commencement of their franchise will not waive their right to pursue claims under state franchise law. This includes claims related to fraud in the inducement, which could arise if the franchisee believes they were misled into signing the agreement based on false representations by Bonchon. This provision offers a layer of security, ensuring franchisees can seek legal recourse if they believe their rights have been violated, without being bound by waivers or disclaimers signed at the outset.

However, it's important to note that while these protections are in place, the specific rights and remedies available to a franchisee will still depend on the franchise laws of their particular state. For example, the Michigan Franchise Investment Law prohibits requiring a franchisee to assent to a release, assignment, novation, waiver, or estoppel that deprives the franchisee of rights and protections provided in the act. Additionally, in California, the Franchise Investment Law states that any provision requiring the franchisee to waive specific provisions of the law is void and unenforceable. Franchisees should consult with legal counsel to fully understand their rights and obligations under the laws of their state.

In summary, Bonchon franchisees are protected from unintentionally waiving their rights under state franchise laws through standard documents signed at the beginning of their franchise relationship. This safeguard is particularly relevant in states with franchise-specific laws designed to protect franchisees. However, franchisees should be aware of the specific regulations in their state and seek legal advice to ensure full compliance and understanding of their rights.