Under what conditions can the Estate of a deceased or disabled Bonchon franchisee continue operating the Business?
Bonchon Franchise · 2025 FDDAnswer from 2025 FDD Document
| Provisions | Section in Area | Summary |
|---|---|---|
| Development Agreement | ||
| I. 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 approval of transfer | Sections 12.03 and 12.04 | See I., above. |
| n. Our right of first | None | Not applicable. |
| refusal to purchase | ||
| your business | ||
| o. Our option to purchase your business | None | Not applicable |
| p. Your death or disability | 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.) |
| q. Non-competition covenants during the term of the franchise | Section 11.01 | No involvement in competing business anywhere. (Subject to state law.) |
| r. Non-competition | Section 11.01 | No involvement in competing business for 2 years within your Development Territory, within a 20 mile radius of the perimeter of your Development Territory or within a 20 mile radius of the perimeter of (or within) any Bonchon Business (whether company-owned, franchised or otherwise established and operated). (Subject to state law.) |
| covenants after the | ||
| franchise is terminated | ||
| or expires | ||
| s. Modification of the agreement | Section 18.05 | No oral modifications. |
| t. |
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 Estate of a deceased or disabled franchisee has specific conditions to meet in order to continue operating the Bonchon business. If the franchise is held by an individual, or if a business entity owns the franchise and the last surviving owner dies or becomes disabled, the rights pass to their Estate.
For an Area Development Agreement, the Estate can continue to operate the Bonchon business if it provides an acceptable Area Business Manager. This manager must assume full-time operation of the franchise within 90 days of the death or disability.
For a Franchise Agreement, the Estate may continue operating the Business if it provides an acceptable Operating Principal and General Manager. This Operating Principal must successfully complete Bonchon's next Initial Training Program or Partner Training Program and assume full-time operation of the franchise within 1 month of the franchisee's death or disability. Alternatively, the Estate can choose to sell the franchise, adhering to the standard transfer requirements. During the period between the franchisee's death or disability and the assumption of full-time control by an Operating Principal, Bonchon has the option to operate the business, but is not obligated to do so. These conditions are subject to state law, which may provide additional or superseding regulations.