Can a Bojangles franchisee mortgage their interest in the franchise without the franchisor's consent?
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 franchisee cannot sell or transfer their interest in the restaurant, real property, or assets without the franchisor's prior written consent. Specifically, if a franchisee enters into an agreement to sell, or sells, 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 Bojangles's prior written consent, it could lead to termination of the franchise agreement. However, Bojangles may request 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, Bojangles 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.
This requirement protects Bojangles by ensuring that franchisees do not transfer ownership or control to individuals or entities that do not meet their standards or that could negatively impact the brand. It also allows Bojangles to maintain control over the location and operation of its restaurants. The franchisee must seek written approval from Bojangles before engaging in any transaction that would transfer their interest in the franchise.
This provision is fairly standard in franchising, as franchisors typically want to have oversight over who operates their branded locations. For a prospective Bojangles franchisee, this means understanding that any potential sale, transfer, or significant asset transaction requires advance approval from Bojangles, and failure to obtain such approval could result in termination of the franchise agreement. The franchisee should factor this requirement into their business planning and exit strategy.