If a Bojangles franchise agreement is terminated and the franchisee contests the validity of the termination, who operates the restaurant during the dispute, and what are their obligations regarding profits?

According to Bojangles's 2025 Franchise Disclosure Document, in the event that a franchise agreement is terminated and the franchisee contests the validity of the termination, the party that operates the restaurant during the period from the termination notice until a final, nonappealable judgment is entered will do so for the benefit of the prevailing party. This means that either Bojangles or the franchisee could be operating the restaurant during the dispute.

The party operating the Bojangles restaurant during the legal dispute is obligated to account for and pay over any profits earned during that period to the other party, but only if the other party ultimately prevails in the dispute. This ensures that the economic benefits of the restaurant operation accrue to the rightful party once the legal matter is resolved.

This arrangement is designed to maintain the continuous operation of the Bojangles restaurant and protect the brand's interests while the legal dispute is ongoing. It also provides a mechanism for ensuring that the prevailing party in the dispute is fairly compensated for the period during which the restaurant's operation was contested. Prospective franchisees should be aware of this clause, as it dictates the financial responsibilities and potential benefits during a termination dispute.