Upon termination of the Bonchon Development Agreement due to default, what specific losses and expenses is the developer obligated to pay to Bonchon?
Bonchon Franchise · 2025 FDDAnswer from 2025 FDD Document
If we terminate because of your default, pay us all losses and expenses we incur as a result of the default or termination, including all damages, costs, and expenses, and reasonable attorneys' and experts' fees directly or indirectly related thereto, such as (without limitation) lost profits, lost opportunities, damage inuring to our Proprietary Marks and reputation, travel and personnel costs and the cost of securing a new Area Developer for the Development Territory. This obligation will give rise to and remain, until paid in full, a lien in our favor against any and all of assets, property, furnishings, equipment, signs, fixtures and inventory owned by you and any of the Bonchon Businesses at the time of termination and against any of your money which we are holding or which is otherwise in our possession.
Source: Item 23 — RECEIPTS (FDD pages 92–536)
What This Means (2025 FDD)
According to Bonchon's 2025 Franchise Disclosure Document, if Bonchon terminates the Development Agreement due to the developer's default, the developer must cover all losses and expenses Bonchon incurs as a result of the default or termination. This includes, but isn't limited to, all damages, costs, and expenses, along with reasonable attorney and expert fees that are directly or indirectly related to the default or termination.
Specifically, these losses and expenses encompass items such as lost profits, lost business opportunities, and any damage to Bonchon's Proprietary Marks and reputation. The developer is also responsible for travel and personnel costs that Bonchon incurs, as well as the expense of finding and securing a new Area Developer for the Development Territory.
To ensure Bonchon is compensated, the agreement stipulates that Bonchon will have a lien against all of the developer's assets, property, furnishings, equipment, signs, fixtures, and inventory owned by the developer and any Bonchon Businesses at the time of termination. This lien also extends to any of the developer's money that Bonchon is holding or is otherwise in its possession, securing Bonchon’s right to recover these losses and expenses.