Under what conditions can Bonchon terminate a franchise agreement before its expiration?
Bonchon Franchise · 2025 FDDAnswer from 2025 FDD Document
Any default or breach by Licensee (or any of its affiliates) of any other agreement between Licensor, or its parent or the subsidiary, affiliate or designee of either entity (collectively, Licensor's "Affiliates") and Licensee (or any of its affiliates) will be deemed a default under this Agreement, and any default or breach of this Agreement by Licensee (or any of its affiliates) will be deemed a default or breach under any and all other agreements between Licensor (or any of its Affiliates) and Licensee (or any of its affiliates). If the nature of such default under any other agreement would have permitted Licensor to terminate this Agreement if default had occurred under this Agreement, then Licensor (or its Affiliates) will have the right to terminate all the other agreements between Licensor (or any of its Affiliates) and Licensee (or any of its affiliates) in the same manner provided for in this Agreement for termination of this Agreement.
If any valid, applicable law or regulation of a competent governmental authority with jurisdiction over this Agreement or the parties to this Agreement limits our rights of termination under this Agreement or requires longer notice or cure periods than those set forth above, then this Agreement will be considered modified to conform to the minimum notice, cure periods or restrictions upon termination required by the laws and regulations. We will not, however, be precluded from contesting the validity, enforceability or application of the laws or regulations in any action, proceeding, hearing or dispute relating to this Agreement or the termination of this Agreement.
Upon any termination of this Agreement by us for cause, we will have the right immediately to enter and take possession of your Bonchon Restaurant to maintain continuous operation of the previously franchised business, provide for orderly change of management and disposition of personal property, and otherwise protect our interests.
If you dispute the validity of our termination of the franchise, we will nevertheless have the option (which you irrevocably grant) to operate the business pending the final, unappealed determination of the dispute by a court of competent jurisdiction.
If a court of competent jurisdiction makes a final, unappealed determination that the termination was not valid, we agree to make a full and complete accounting for the period during which we operated the previously franchised business.
Discontinue the use of the Proprietary Marks, and not operate or do business under any name or in any manner which might tend to give the general public the impression that you are operating a Bonchon Business, a Bonchon Restaurant or any similar business.
Take all necessary action to cancel any assumed name or equivalent registration which contains the Proprietary Mark "Bonchon", or any other Proprietary Mark of ours, or any variant, within fifteen days following termination or expiration of this Agreement.
Source: Item 23 — RECEIPTS (FDD pages 92–536)
What This Means (2025 FDD)
According to Bonchon's 2025 Franchise Disclosure Document, Bonchon can terminate the franchise agreement early if the franchisee (or any of its affiliates) defaults or breaches any agreement between the franchisee and Bonchon (or its affiliates). This is known as a cross-default provision. If the nature of the default under the other agreement would have allowed Bonchon to terminate the Franchise Agreement, Bonchon has the right to terminate all other agreements between them.
Additionally, if any applicable law or regulation limits Bonchon's termination rights or requires longer notice or cure periods than those outlined in the agreement, the agreement will be modified to comply with those minimum requirements. However, Bonchon retains the right to contest the validity, enforceability, or application of such laws or regulations.
Upon termination of the agreement, Bonchon has the right to enter and take possession of the Bonchon Restaurant if the termination is for cause. This allows Bonchon to maintain continuous operation of the business, manage the transition, and protect its interests. If the franchisee disputes the termination's validity, Bonchon still has the option to operate the business pending a final court decision. If the court determines the termination was invalid, Bonchon must provide a full accounting for the period it operated the business. Furthermore, the franchisee is obligated to discontinue using Bonchon's Proprietary Marks and must take action to cancel any assumed name registrations containing "Bonchon" within fifteen days following termination or expiration of the agreement.