What rights does Bonchon grant to the franchisee regarding the use of Proprietary Marks and the System?
Bonchon Franchise · 2025 FDDAnswer from 2025 FDD Document
d for a franchise to own and operate a Bonchon Restaurant.
2. GRANT OF FRANCHISE AND LICENSE
2.01 Grant of Franchise and Licenses
We grant you, and you accept, the right to use the Proprietary Marks and the System in connection with establishing and operating a Bonchon Business and Restaurant from the Restaurant Location specified in Section 3.01 of this Agreement. You agree to use the Proprietary Marks and Bonchon System as we may change, improve, modify or further develop them from time to time as provided in this Agreement, and to operate your Bonchon Business and its Restaurant only in accordance with the terms and conditions of this Agreement and all related agreements, the Manuals and any Supplement to the Manuals. You further agree to honestly and diligently perform your obligations under this Agreement and to use your best efforts to promote the Restaurant. You may not subfranchise or otherwise grant to any other "Person" (meaning both natural persons and legal entities, including corporations, partnerships, limited liability companies and trusts) any interest in this Agreement or the franchise granted hereby, except as otherwise provided in this Agreement.
3. RESTAURANT LOCATION
3.01 Restaurant Location; Protected Territory
Your right to operate a Bonchon Business and Restaurant is restricted to the location designated in Exhibit A (the "Restaurant Location"). Your Bonchon Business will be prohibited from directly delivering products to customers; rather, it will be required to utilize a third-party delivery service that we have designed and/or approved in advance in order to fulfill online delivery orders. Under this Agreement, your Bonchon Business may establish only one Bonchon Restaurant located at the Restaurant Location. You shall be granted a protected territory that will be a certain area around your Restaurant Location (the "Protected Territory"). Your Protected Territory will be described in Exhibit A annexed hereto. If we use both a written description and a map to define your Protected Territory, you acknowledge and expressly agree that should there be a conflict between the written description and the map, the written description will control.
3.02 Our Restrictions
Within the Protected Territory, neither we nor any affiliate (as defined in Section 3.04 below) will operate or grant a franchise for a Bonchon Business operated under the Proprietary Marks of the type franchised to you hereunder, except as provided in Section 3.04 ("Rights We Reserve"). These restrictions will terminate immediately upon the expiration or termination of this Agreement for any reasons.
Outside of the Protected Territory, we and/or our affiliates reserve the right to operate any number of Bonchon Businesses and Restaurants, and/or authorize others to operate same, at any location whatsoever, including one or more locations that may be proximate to, adjacent to or abutting the boundary of the Protected Territory.
3.03 Your Restrictions
Your Bonchon Business may only offer and sell its products and services in, at and from your Bonchon Restaurant at the Restaurant Location situated within the Protected Territory. Under no circumstance may your Business establish any physical presence outside of your Protected Territory at or from which your products or services are sold or furnished. Nor may your Business offer or sell any products or services anywhere, through any means or manner other than your Restaurant, including alternative channels of distribution, such as the internet/worldwide web and other forms of electronic commerce; "800" or similar toll-free telephone numbers (other than those we establish and make available to you for your customers to place orders with your franchised Restaurant); supermarkets, grocery stores or convenience stores; mail orders; catalogs; telemarketing or other direct marketing sales;
Source: Item 23 — RECEIPTS (FDD pages 92–536)
What This Means (2025 FDD)
According to Bonchon's 2025 Franchise Disclosure Document, Bonchon grants the franchisee the right to use the Proprietary Marks and the System in connection with establishing and operating a Bonchon restaurant from the designated Restaurant Location. The franchisee must use the Proprietary Marks and Bonchon System as Bonchon may change, improve, modify, or further develop them. The franchisee is obligated to operate the Bonchon Business and its Restaurant according to the terms and conditions of the Franchise Agreement, related agreements, the Manuals, and any Supplements to the Manuals. The franchisee must perform their obligations honestly and diligently and use their best efforts to promote the Restaurant. Subfranchising or granting any interest in the Agreement or the franchise to another person is prohibited, except as otherwise provided in the Agreement.
Bonchon retains the right to modify the Bonchon System, including products, services, programs, methods, standards, and even the Proprietary Marks themselves. These modifications can be implemented through Supplements to the Manuals or other means. For example, Bonchon may require franchisees to institute drive-through and/or delivery services. Franchisees are required to implement these system modifications as if they were part of the System at the time the Agreement was signed. Bonchon also reserves the right to vary its standards or franchise agreement terms for any franchised Bonchon Business, based on various conditions, without any obligation to disclose any variation or to grant the same or a similar variation to the franchisee.
The franchisee's right to operate a Bonchon Business and Restaurant is restricted to the location designated in Exhibit A. The Bonchon Business will be prohibited from directly delivering products to customers; rather, it will be required to utilize a third-party delivery service that Bonchon has designed and/or approved in advance in order to fulfill online delivery orders. The franchisee will be granted a protected territory that will be a certain area around the Restaurant Location, described in Exhibit A. However, Bonchon and its affiliates retain the right to operate other businesses, including those selling similar products or services under different marks, and to utilize alternative distribution channels, even within the franchisee's protected territory. The franchisee will not receive compensation for sales made through these other channels.
Upon termination or expiration of the Franchise Agreement, the franchisee loses all rights to use Bonchon's Proprietary Marks, the Bonchon System, Confidential Information, and any goodwill associated with the brand. The franchisee must discontinue using the Proprietary Marks and must not operate under any name or manner that might give the impression of operating a Bonchon Business. They are also prohibited from using any Confidential Information or identifying themselves as a current or former Bonchon franchisee. The franchisee must take action to cancel any assumed name registrations containing the Proprietary Mark "Bonchon" or any other Proprietary Mark of Bonchon.