If a Bojangles Developer transfers interest in the Development Agreement without Franchisor consent, what must the Developer do to avoid asset purchase by Bojangles?
Bojangles Franchise · 2025 FDDAnswer from 2025 FDD Document
- (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;
Source: Item 23 — RECEIPTS (FDD pages 82–573)
What This Means (2025 FDD)
According to Bojangles' 2025 Franchise Disclosure Document, if a Developer transfers any interest in the Development Agreement, rights, or obligations without Bojangles' prior written consent, Bojangles has the option to purchase the assets of all Restaurants opened under the Development Agreement. This is contingent on the transfer violating the terms outlined in Paragraph IX of the agreement.
To avoid Bojangles purchasing the assets of the restaurants, the Developer must obtain prior written consent from Bojangles for any transfer of interest in the Development Agreement. This includes any rights or obligations under the agreement, or any interest in the Developer itself, to a third party. The requirement for consent is rooted in Bojangles' reliance on the Developer's business skill and financial capacity when granting the Development Agreement.
It is important to note that Bojangles' consent to a transfer does not waive any claims they may have against the transferring party, nor does it waive Bojangles' right to demand compliance with the agreement terms by the transferee. Failure to comply with the transfer requirements can cause irreparable injury to Bojangles, potentially leading to legal action where the Developer may be responsible for court costs and attorney's fees.