Which section in the Bonchon Franchise Agreement addresses transfer?
Bonchon Franchise · 2025 FDDAnswer from 2025 FDD Document
| Provisions | Section in Area Development Agreement | Summary |
|---|---|---|
| l. Our approval of transfer by you | Section 12.02, 12.03 and 12.04 | No transfer without our consent except as provided in Area Development Agreement (for example, transfer to a business entity you form for convenience). (Subject to state law.) |
| m. Conditions for our | Sections 12.03 | See l., above. |
| approval of transfer | and 12.04 | |
| n. Our right of first | None | Not applicable. |
| refusal to purchase | ||
| your business | ||
| o. Our option to | None | Not applicable |
| purchase your business | ||
| p. Your death or disa- bility | Section 12.04 | On your death or disability (if you are an individual), or the death or disability of your last surviving owner (if you are a business entity), that person’s rights pass to his or her "Estate". The Estate may continue operating the Business if it provides an acceptable Area Business Manager. This Area Business Manager must assume full time operation of the franchise within 90 days of death or disability. (Subject to state law.) |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION THE FRANCHISE RELATIONSHIP (FDD pages 71–81)
What This Means (2025 FDD)
According to Bonchon's 2025 Franchise Disclosure Document, the provisions for transfer by the franchisee are detailed in Sections 12.02, 12.03, and 12.04 of the Area Development Agreement. These sections outline that a franchisee cannot transfer their rights without Bonchon's consent, although there are exceptions, such as transferring to a business entity formed for convenience, subject to state law.
These sections also specify the conditions for Bonchon's approval of a transfer, which are further elaborated in Sections 12.03 and 12.04. Additionally, the FDD notes that Bonchon does not have the right of first refusal or an option to purchase the business in the event of a transfer.
In the event of the death or disability of the franchisee (if an individual) or the last surviving owner (if a business entity), Section 12.04 stipulates that the rights pass to the Estate. The Estate may continue operating the Bonchon business if it provides an acceptable Area Business Manager who assumes full-time operation within 90 days, subject to state law. This provides a contingency plan for the continuation of the franchise in unforeseen circumstances.