What happens if a Bojangles franchisee's right to possession of the restaurant premises is terminated prematurely?
Bojangles Franchise · 2025 FDDAnswer from 2025 FDD Document
n of the Restaurant, it shall exercise its right to purchase the Restaurant or vacate the premises by the end of the foregoing period.
- E. In order to maintain continuous operation of the Restaurant and to promote the best interests of the System, in the event this Agreement is terminated, Franchisor shall have the right immediately upon termination to enter and take possession of and operate the Restaurant. Nothing herein contained in Paragraph XIV.E shall be intended to give Franchisor control of Franchisee's employees.
- F. In the event that this Agreement is terminated and Franchisee contests the validity of the termination, the party that operates the Restaurant during the period commencing with the date that notice of termination was given and ending with the date upon which a final notice and nonappealable judgment resolving the issue is entered, shall operate the Restaurant for the benefit of the prevailing party in such contest, and shall account for, and pay over, any profits earned during said period to the other party, if such other party is the party that prevails.
- G. Upon termination of this Agreement owing to default by Franchisee, Franchisee shall not remove any furniture, fixtures, signs, equipment or other property or leasehold improvements from the Restaurant premises until expiration of the period within which Franchisor may exercise its right to purchase the Restaurant. If Franchisor does not elect to purchase the Restaurant it may nevertheless elect, within ninety (90) days of the date of termination, to purchase Franchisee's furniture, fixtures, signs, equipment, leasehold improvements and other property or any portion thereof for a sum equal to the fair market value of such property. If the parties cannot agree on a fair market value within a reasonable time, an independent appraiser shall be designated by Franchisor, and the appraiser's determination shall be binding. Any property so purchased by Franchisor shall be delivered to Franchisor's representative at the Restaurant premises on a date specified in the purchase notice by Franchisor not more than five (5) days after delivery of the purchase notice or at such other time as may be reasonable in the circumstances. If Franchisor elects to exercise any right to purchase herein provided, it shall have the right to set off all amounts due from Franchisee, and the cost of the appraisal, if any, against any payment therefor.
- H. Upon expiration of this Agreement or termination resulting from any condemnation proceedings affecting the premises upon which the Restaurant is situated, within sixty (60) days prior to the date specified for expiration or takeover by any public authority, Franchisee shall not remove any furniture, fixtures, signs, equipment and other property or leasehold improvements. Franchisor may, upon written notice at least thirty (30) days prior to such date, notify Franchisee of its intention to purchase all or any portion of the furniture, fixtures, signs, equipment and other chattels for a sum equal to the fair market value of such property. Determination of fair market value and the terms of delivery shall be as specified in Paragraph XIV.G. hereof.
XV. OBLIGATIONS UPON TERMINATION OR EXPIRATION
Upon termination or expiration of this Agreement, all rights granted hereunder to Franchisee shall forthwith terminate, and:
- A. Franchisee shall immediately cease to operate the Franchised Business, and shall not thereafter, directly or indirectly, represent to the public or hold itself out as a present or former franchisee of Franchisor.
- B.
Source: Item 22 — CONTRACTS (FDD page 82)
What This Means (2025 FDD)
According to Bojangles's 2025 Franchise Disclosure Document, if the Franchise Agreement is terminated, Bojangles has the right to immediately enter, take possession of, and operate the restaurant. This is intended to maintain continuous operation of the restaurant and promote the best interests of the Bojangles system. However, this right does not give Bojangles control over the franchisee's employees.
If the franchisee contests the validity of the termination, the party operating the restaurant during the period from the termination notice until a final, nonappealable judgment is entered will operate the restaurant for the benefit of the prevailing party. The operating party must account for and pay over any profits earned during that period to the other party if the other party prevails in the dispute.
Furthermore, the landlord must deliver to Bojangles a copy of any notice of default or termination of the lease at the same time the notice is delivered to the franchisee. The franchisee assigns all rights, title, and interests in the lease to Bojangles upon termination of the Franchise Agreement, provided that the Franchise Agreement is terminated, not renewed, or expires without renewal, or Bojangles has exercised its option to purchase the restaurant, and Bojangles notifies the franchisee and landlord in writing that it assumes the franchisee's obligations under the lease. Bojangles has the right, but not the obligation, to cure any breach of the lease and succeed to the franchisee's rights and interests under the lease.
If Bojangles elects to lease the property, the franchisee will lease the land and building to Bojangles on Bojangles's standard lease form for company-operated restaurants. Bojangles will purchase the equipment, inventory, and supplies at their depreciated net tangible book value. Net annual rental payments will be the higher of 14% of the depreciated net tangible book value of the land and restaurant building, or 6.5% of gross sales up to the amount of gross sales for the 12 months preceding Bojangles's occupancy, and 5% of gross sales exceeding that amount. Bojangles must exercise its right to purchase the franchised business within a specific timeframe: the later of 60 days after the termination date, the date it takes possession of the restaurant, or 10 days after any litigation contesting the termination is finally adjudicated. If Bojangles has taken possession, it must either exercise its right to purchase the restaurant or vacate the premises by the end of this period.