What constitutes a material breach of the Bojangles franchise agreement regarding transfer?
Bojangles Franchise · 2025 FDDAnswer from 2025 FDD Document
- (8) If Franchisee ceases to operate or otherwise abandons, or attempts to cease to operate or abandon, the Restaurant or enters into an agreement to sell, or sells, or purports or attempts to sell, the real property upon which the Restaurant is situated, or substantially all right, title and interest in and to the Restaurant or real property lease, or substantially all of the assets of Franchisee or of the Restaurant, without Franchisor's prior written consent; provided, however, that upon the occurrence of any of the foregoing events, Franchisor may, in lieu of immediate termination of this Agreement, request from Franchisee, a statement of intentions and assurances that no event in breach of this Agreement is so contemplated, which statement and assurances shall be delivered in writing within twenty-four (24) hours of Franchisor's request.
In addition, Franchisor may request, and Franchisee shall provide within five (5) business days thereafter, a performance bond from Franchisee, the amount of such bond and the issuing entity to be solely at Franchisor's reasonable discretion.
Source: Item 23 — RECEIPTS (FDD pages 82–573)
What This Means (2025 FDD)
According to Bojangles's 2025 Franchise Disclosure Document, a material breach regarding transfer occurs if a franchisee ceases to operate or abandons the restaurant, attempts to do so, or enters into an agreement to sell the real property, the restaurant, or its assets without Bojangles's prior written consent. However, in such instances, Bojangles may request a statement of intentions and assurances from the franchisee within 24 hours, along with a performance bond within five business days, instead of immediate termination. The amount and issuing entity of the bond are at Bojangles's discretion.
This clause protects Bojangles by ensuring that franchisees do not transfer ownership or abandon operations without the franchisor's approval. This allows Bojangles to maintain control over the brand and ensure that new operators meet their standards. The option to request a statement of intent and a performance bond provides a chance for the franchisee to rectify the situation and avoid termination, offering a degree of flexibility.
For a prospective franchisee, this means that any intention to sell or transfer the restaurant must be communicated to and approved by Bojangles. Failure to obtain this consent can lead to termination of the franchise agreement. The requirement for a performance bond adds another layer of potential financial burden if the franchisor deems it necessary to ensure compliance. Franchisees should be aware of these conditions and maintain open communication with Bojangles regarding any potential changes in ownership or operation.