Are there any exceptions to the confidentiality obligations regarding the Bonchon franchise agreement's specific terms, and if so, under what conditions?
Bonchon Franchise · 2025 FDDAnswer from 2025 FDD Document
Section 12.02 of the Franchise Agreement ("Covenant Not to Compete"), and the Confidentiality/Non-Competition Agreement and Confidentiality Agreement attached to the Franchise Agreement, are each amended to add that non-parties to the Franchise Agreement are only bound to the confidentiality and/or non-competition provisions if they execute such Confidentiality/Non-Competition Agreement themselves.
Source: Item 23 — RECEIPTS (FDD pages 92–536)
What This Means (2025 FDD)
According to Bonchon's 2025 Franchise Disclosure Document, non-parties to the Franchise Agreement are only bound to the confidentiality and/or non-competition provisions if they execute such a Confidentiality/Non-Competition Agreement themselves. This means that individuals or entities who are not directly part of the Bonchon franchise agreement are not automatically subject to its confidentiality terms unless they specifically agree to them by signing a separate agreement.
Bonchon also requires franchisees to obtain Confidentiality/Non-Competition Agreements from specific individuals, including the Operating Principal (if they have an ownership interest), owners, equity holders, control persons, shareholders, members, partners, general partners, officers, directors, and managers. These agreements must be secured within ten days of the Effective Date of the franchise agreement or within ten days of an individual attaining one of the aforementioned statuses. Franchisees must also provide copies of these executed agreements to Bonchon within ten days of their execution.
Furthermore, Bonchon requires franchisees to obtain a Confidentiality Agreement from their Operating Principal (if they do not hold an ownership interest), General Manager, Area Manager, and all other managerial staff before their employment or promotion. Bonchon emphasizes the importance of enforcing these agreements, requiring franchisees to vigorously prosecute any breaches of the Confidentiality/Non-Competition Agreements. Bonchon also retains the right to enforce these agreements themselves.
These stipulations ensure that Bonchon's confidential information is protected not only by the franchisee but also by key individuals involved in the operation of the franchise. This multi-layered approach to confidentiality is common in franchising to safeguard proprietary information and maintain a competitive advantage.