What are the specific obligations of a Bonchon franchisee regarding the payment of taxes and other government fees (Item 9), and how does the franchisor assist the franchisee with understanding these obligations?
Bonchon Franchise · 2025 FDDAnswer from 2025 FDD Document
may not withhold, set-off or recoup payment of any amount due on the grounds of the alleged non-performance or breach of any of our or our affiliates' obligations under this or any other agreement.
- E. In addition to all other payments under this Agreement, you agree to pay us or our affiliates immediately upon demand: (a) all sales taxes, trademark license taxes and any other taxes, imposed on, required to be collected, or paid by us or our affiliates (excluding any corporate income taxes imposed on us or our affiliates) because we or our affiliates have furnished services or products to you, collected any fee from you, collected any fee from you, licensed our Proprietary Marks to you and/or entered into this Agreement with you; (b) all amounts we advance, pay or become obligated to pay on your behalf for any reason; (c) all amounts you owe us or our affiliates for products or services that you purchase from us or our affiliates; and (d) all amounts you owe us or our affiliates for programs, products or services that you purchase from us or our affiliates.
6. SITE SELECTION, CONSTRUCTION, TRADE DRESS AND LEASE REQUIREMENTS
6.01 Restaurant Location
- A. You may operate your franchised Bonchon Business only from your Restaurant Location. You may use the Restaurant Location for no other purpose than the operation of the franchised Business.
- B. If you have suggested a Restaurant Location which we have approved before the execution of this Agreement, then the address of that Restaurant Location will be set forth on Exhibit A to this Agreement.
What This Means (2025 FDD)
According to Bonchon's 2025 Franchise Disclosure Document, franchisees are responsible for various tax-related obligations. Bonchon franchisees must pay all sales taxes, trademark license taxes, and any other taxes imposed on, required to be collected, or paid by Bonchon or its affiliates due to services or products furnished to the franchisee, fees collected from the franchisee, licensing of proprietary marks, and/or the franchise agreement itself. These tax obligations exclude any corporate income taxes imposed on Bonchon or its affiliates. Franchisees must pay these taxes immediately upon demand from Bonchon or its affiliates.
Additionally, Bonchon franchisees participating in specific programs with Pepsi-Cola are responsible for any applicable taxes, fees, or other tax liability incurred in connection with their receipt of funding, equipment, and packaged products equipment provided by Pepsi-Cola under their agreement. These franchisees cannot assess or impose any common area maintenance fees, taxes, or other charges on Pepsi-Cola or its bottlers based on the occupation of space allocated to the equipment or the ownership/usage thereof. Franchisees must also accurately complete and return a Form W-9 (or Form W-8, if applicable) upon execution of the agreement or upon request by Pepsi-Cola. Pepsi-Cola reserves the right to subject payments due to franchisees under the agreement to backup federal tax withholding as required by IRS regulations.
The FDD excerpts do not specify how Bonchon assists franchisees in understanding or managing these tax obligations. A prospective franchisee should seek clarification from Bonchon regarding what specific guidance or resources Bonchon provides to help franchisees comply with their tax obligations and manage tax-related issues.