What happens if any agreement between Bojangles and the Developer is terminated due to the Developer's default?
Bojangles Franchise · 2025 FDDAnswer from 2025 FDD Document
F. Upon termination of this Agreement, Developer shall have no right to establish or operate any Restaurant for which a Franchise Agreement has not been executed by Franchisor and delivered to Developer at the time of termination; and Franchisor shall be entitled to establish, and to license others to establish, Restaurants in the Assigned Area except as may be otherwise provided under any other agreement which is then in effect between Franchisor and Developer.
- (2) Terminate the territorial exclusivity granted Developer in Paragraph I.B. hereof, or reduce the area of territorial exclusivity granted Developer hereunder;
- (3) Terminate all Franchise Agreements, development agreements or any other agreements entered into between Franchisor and Developer or its affiliates (or any beneficial owner(s) of Developer or its affiliates), thereby obligating Developer or its affiliates (or any beneficial owner(s) of Developer or its affiliates) to cease operating Restaurants under the Bojangles System, to deidentify the Restaurants from the Bojangles System, and to comply with all obligations upon termination or expiration set forth in the Franchise Agreements;
- (4) Terminate this Development Agreement, as a result of which Developer shall have no further rights to develop and construct Restaurants, but permit Developer to continue to own and operate any and all Restaurants already operating hereunder so long as Developer is in full compliance with any and all terms and conditions of all franchise agreements entered into pursuant to this Development Agreement; and
- (5) Purchase the assets of all, but not less than all, Restaurants that Developer has opened under this Development Agreement, but this remedy shall only be available to Franchisor upon the following circumstances:
- (a) If Developer or any shareholder or member of Developer transfers or purports or attempts to transfer any interest in this Agreement, any rights or obligations under this Agreement or any interest in Developer to any third party without Franchisor's prior written consent, contrary to the terms of Paragraph IX of this Agreement;
- (b) If Developer or any franchisee under a Franchise Agreement entered into pursuant to this Agreement ceases to operate or otherwise abandons, or attempts to cease to operate or abandon, any Restaurant or enters into an agreement to sell or otherwise transfer, or sells or otherwise transfers, or purports or attempts to sell or otherwise transfer, 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 Developer, of the franchisee or of any Restaurant, without Franchisor's prior written consent, and Developer and the franchisee have failed to give adequate assurances and provide the performance bond as provided in Paragraph VIII. C. (6).
Source: Item 23 — RECEIPTS (FDD pages 82–573)
What This Means (2025 FDD)
According to Bojangles' 2025 Franchise Disclosure Document, if the Development Agreement is terminated due to the Developer's default, the Developer loses the right to establish or operate any Bojangles restaurant for which a Franchise Agreement has not been executed and delivered at the time of termination. Bojangles is then entitled to establish, or license others to establish, restaurants in the assigned area, unless otherwise provided under another agreement between Bojangles and the Developer that is still in effect.
Bojangles also has the option to terminate the territorial exclusivity granted to the Developer, or reduce the area of territorial exclusivity. Bojangles can terminate all Franchise Agreements, development agreements, or any other agreements between Bojangles and the Developer or its affiliates. This would obligate the Developer or its affiliates to cease operating restaurants under the Bojangles system, de-identify the restaurants from the Bojangles system, and comply with all obligations upon termination or expiration set forth in the Franchise Agreements.
Alternatively, Bojangles may terminate the Development Agreement, which means the Developer will no longer have the right to develop and construct restaurants, but can continue to own and operate any restaurants already operating, as long as the Developer is in full compliance with the franchise agreements. Bojangles also has the option to purchase the assets of all restaurants that the Developer has opened under the Development Agreement under certain circumstances, such as if the Developer attempts to transfer any interest in the agreement without Bojangles' prior written consent or if the Developer ceases to operate or abandons a restaurant.