If a Bojangles franchisee sells substantially all right, title and interest in and to the restaurant, what are the consequences?
Bojangles Franchise · 2025 FDDAnswer from 2025 FDD Document
- (8) If Franchisee ceases to operate or otherwise abandons, or attempts to cease to operate or abandon, the Restaurant or enters into an agreement to sell, or sells, or purports or attempts to sell, 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 Franchisee or of the Restaurant, without Franchisor's prior written consent; provided, however, that upon the occurrence of any of the foregoing events, Franchisor may, in lieu of immediate termination of this Agreement, request from Franchisee, a statement of intentions and assurances that no event in breach of this Agreement is so contemplated, which statement and assurances shall be delivered in writing within twenty-four (24) hours of Franchisor's request.
In addition Franchisor may request, and Franchisee shall provide within five (5) business days thereafter, a performance bond from Franchisee, the amount of such bond and the issuing entity to be solely at Franchisor's reasonable discretion.
Source: Item 22 — CONTRACTS (FDD page 82)
What This Means (2025 FDD)
According to Bojangles's 2025 Franchise Disclosure Document, if a franchisee enters into an agreement to sell, or sells, or attempts to sell substantially all right, title, and interest in the restaurant without Bojangles's prior written consent, Bojangles may take certain actions. Instead of immediately terminating the Franchise Agreement, Bojangles may request a statement of intentions and assurances from the franchisee that no breach of the agreement is contemplated. This statement must be provided in writing within 24 hours of the request.
Additionally, Bojangles has the option to request a performance bond from the franchisee. The amount of this bond and the issuing entity will be determined at Bojangles's reasonable discretion. This bond serves as a security measure to ensure the franchisee's compliance with the terms of the agreement, even during the transition period related to the attempted sale.
These stipulations are fairly standard in franchising, as they protect the franchisor's brand and ensure that any transfer of ownership meets their standards and doesn't negatively impact the franchise system. The requirement for written consent allows Bojangles to vet potential buyers and maintain control over who operates a Bojangles restaurant. The performance bond provides an additional layer of financial security for Bojangles during uncertain periods.