After the Bojangles franchise agreement expires or terminates, for how long is the franchisee restricted from engaging in competing restaurant businesses?
Bojangles Franchise · 2025 FDDAnswer from 2025 FDD Document
(2) During the continuing uninterrupted period commencing upon the expiration or termination of this Agreement, regardless of the cause for termination, and continuing for two (2) years thereafter, except as otherwise approved in writing by Franchisor, Franchisee and its shareholders or members shall not, either directly or indirectly, for themselves, or through, on behalf of, or in conjunction with any person, persons, partnership, corporation, or limited liability company, own, maintain, advise, help, invest in, make loans to, be employed by, be the landlord of, engage in, or have any interest in:
(a) Any restaurant business which: (i) competes with any Bojangles restaurant or which sells fried chicken, biscuits and/or biscuit sandwiches, or other items which are featured menu items at Bojangles restaurants as of the termination or expiration of this Agreement, and (ii) is located within ten (10) miles from the Restaurant or any Bojangles restaurant that is open, planned for construction or under construction as of the termination or expiration of this Agreement; or
(b) Any fast food restaurant business which is located (i) within ten (10) miles from the Restaurant or any Bojangles restaurant that is open, planned for construction, or under construction as of the termination or expiration of this Agreement, or (ii) within the designated market area within which the Restaurant is situated.
B.
Paragraph XVII.A. shall not apply to ownership by Franchisee of less than two percent (2%) beneficial interest in the outstanding equity securities of any corporation which is registered under the Securities Exchange Act of 1934.
- C.
The parties agree that each of the foregoing covenants shall be construed as independent of any other covenant or provision of this Agreement.
Source: Item 23 — RECEIPTS (FDD pages 82–573)
What This Means (2025 FDD)
According to Bojangles's 2025 Franchise Disclosure Document, a franchisee faces certain restrictions regarding involvement with competing restaurant businesses after the franchise agreement expires or terminates. Specifically, for a period of two years following the expiration or termination of the agreement, the franchisee is restricted from engaging in any competing restaurant business without written approval from Bojangles. This restriction applies regardless of the reason for termination.
The restrictions prevent the franchisee (and their shareholders or members) from owning, maintaining, advising, helping, investing in, making loans to, being employed by, being a landlord of, engaging in, or having any interest in a restaurant business that competes with Bojangles. This includes businesses that sell fried chicken, biscuits, biscuit sandwiches, or other featured menu items similar to those offered at Bojangles restaurants. The restricted area includes locations within ten miles of the former Bojangles restaurant or any other Bojangles restaurant that is open, planned for construction, or under construction. The restriction also applies to any fast-food restaurant within that ten-mile radius or within the designated market area of the former Bojangles location.
However, there is an exception to this restriction. The franchisee is allowed to own less than two percent of the equity securities of any corporation registered under the Securities Exchange Act of 1934, even if that corporation operates a competing restaurant business. This exception allows franchisees to make minor investments in publicly traded companies without violating the non-compete clause. The FDD also states that each covenant within the agreement is considered independent of any other, reinforcing the enforceability of these restrictions.
This non-compete agreement ensures that former franchisees do not directly leverage their experience and knowledge gained from operating a Bojangles franchise to compete against the Bojangles system in close proximity to existing or planned locations. Prospective franchisees should carefully consider these post-term restrictions and how they might impact their future business ventures after leaving the Bojangles system.