What happens if two owners each own 50% of the ownership interests in a Bojangles franchise?
Bojangles Franchise · 2025 FDDAnswer from 2025 FDD Document
You must be a corporation or a limited liability company composed solely of no more than six shareholders/members who are natural persons and not corporations, limited liability companies, or any other legal entities in order to be a developer or franchisee. You must complete an Affidavit of Ownership, the form of which is attached as Exhibit I, when you sign the Development Agreement and/or Franchise Agreement. You may not form separate legal entities to operate your individual Restaurants. In addition, you cannot be owned by two owners who each own 50% of your ownership interests.
Your Managing Owner will be the person with whom we will communicate and will have the authority to bind you with respect to all financial, operational and legal matters related to the Franchised Business and your Development Agreements and Franchise Agreements with us. The Managing Owner shall own a majority of your equity interests during the entire period s/he serves as Managing Owner. If you do not have an owner with a majority equity interest, the Managing Owner shall own the next highest percentage equity interest during the entire period s/he serves as Managing Owner. The same individual may serve as your Managing Owner of all the franchised Restaurants controlled by you. Your Managing Owner must: (1) successfully complete our initial training program; (2) execute the Development Agreement and Franchise Agreement and be individually bound by all your obligations under those agreements; and (3) be approved by us. The Managing Owner may also serve as your Designated Operator as described below provided that the Managing Owner meets the criteria for both positions independently.
Source: Item 15 — OBLIGATION TO PARTICIPATE IN THE ACTUAL OPERATION OF THE FRANCHISE BUSINESS (FDD pages 53–54)
What This Means (2025 FDD)
According to Bojangles's 2025 Franchise Disclosure Document, a franchisee cannot be owned by two owners who each possess 50% of the ownership interests. Bojangles requires that if the franchise is owned by multiple parties, one individual must hold a majority equity interest and serve as the Managing Owner. This Managing Owner is Bojangles's primary point of contact and has the authority to make binding decisions on behalf of the franchise regarding financial, operational, and legal matters.
If no owner holds a majority equity interest, the Managing Owner must hold the next highest percentage equity interest. This ensures that there is always a clear decision-maker with a significant stake in the business. The Managing Owner must also complete Bojangles's initial training program, be individually bound by all obligations under the Development and Franchise Agreements, and be approved by Bojangles.
This requirement is designed to streamline communication and ensure accountability within the franchise ownership structure. By mandating a Managing Owner with a defined level of authority, Bojangles aims to avoid potential conflicts or delays in decision-making that could arise from a deadlocked ownership situation. Prospective franchisees should carefully consider this requirement when structuring their ownership arrangements to ensure compliance with Bojangles's franchise agreement.