Can Bonchon terminate the franchise agreement immediately if the franchisee fails to comply with the non-compete covenant?

Based on the 2025 Bonchon Franchise Disclosure Document, it is not explicitly stated whether Bonchon can immediately terminate the franchise agreement for failure to comply with the non-compete covenant. However, the FDD does state that franchisees must strictly comply with the post-termination/post-expiration covenants not to compete set forth in Article 12 of the Franchise Agreement.

Item 23 of the Bonchon FDD outlines various scenarios that could lead to termination of the franchise agreement, such as failure to comply with laws, repeated failure to comply with the agreement, or failure to maintain required insurance. While these scenarios do not specifically mention non-compliance with the non-compete covenant, they highlight the potential for termination based on breaches of the agreement.

To fully understand the implications of violating the non-compete agreement, a prospective Bonchon franchisee should review Article 12 of the Franchise Agreement, which is referenced in Item 23. Additionally, they should seek clarification from Bonchon regarding the specific consequences of non-compliance, including whether immediate termination is a possible outcome. Understanding these terms is crucial for any potential franchisee to assess the risks and obligations associated with the Bonchon franchise.