Under what conditions can Bonchon terminate the Franchise Agreement immediately due to failure to purchase insurance?
Bonchon Franchise · 2025 FDDAnswer from 2025 FDD Document
9.05 Failure To Purchase Insurance Or To Reimburse
If you fail to purchase or maintain any insurance required by this Agreement or you fail to reimburse us for our purchase of any required insurance on your behalf, your failure will be a material and incurable breach of this Agreement which, unless we waive the breach, will entitle us to terminate this Agreement immediately upon notice to you, with no opportunity to cure.
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 immediately if a franchisee fails to purchase or maintain the required insurance. This is considered a material and incurable breach of the agreement. Bonchon does not provide an opportunity for the franchisee to correct this failure.
This means that a Bonchon franchisee must ensure they have all the necessary insurance coverage in place and keep those policies active throughout the term of the agreement. Failure to do so gives Bonchon the right to terminate the agreement without any prior warning or chance for the franchisee to rectify the situation.
This policy is stricter than some franchise agreements, which may allow a period to cure a breach of contract. Because Bonchon considers failure to maintain insurance an incurable breach, prospective franchisees should carefully review the insurance requirements and ensure they can consistently meet them to avoid immediate termination of their franchise agreement.