Under what condition is a Bonchon member's expulsion automatic, without requiring a meeting or vote of the Board or membership?

According to Bonchon's 2025 Franchise Disclosure Document, a member's expulsion from the Corporation is automatic and does not require a meeting or vote of the Board or membership if the member no longer has a license in good standing to operate a Bonchon Business in the ADI (Area of Dominant Influence). This means that if a franchisee's license to operate a Bonchon restaurant within their designated area is terminated or expires, they are automatically expelled from the Bonchon franchisee association.

This condition is significant for prospective Bonchon franchisees because it highlights the importance of maintaining a license in good standing. A franchisee's membership in the Corporation, which could provide benefits such as collective bargaining power or access to resources, is directly tied to their active franchise agreement. Failure to maintain the franchise license results in automatic expulsion from the Corporation, potentially isolating the franchisee from the collective support and representation it offers.

This clause protects the integrity and standards of the Bonchon brand by ensuring that only active and compliant franchisees are members of the Corporation. It also streamlines the expulsion process in cases where a franchisee's license is no longer valid, avoiding the need for lengthy and potentially contentious meetings or votes. Prospective franchisees should carefully review the terms and conditions of the franchise agreement to understand what constitutes a license in "good standing" and what actions could lead to its termination, thereby triggering automatic expulsion from the Corporation.