If a transfer of a Bojangles franchise involves a controlling interest, what financial obligations must be satisfied before the transfer can be approved?
Bojangles Franchise · 2025 FDDAnswer from 2025 FDD Document
each of this Agreement, for which Franchisor may then terminate without opportunity to cure pursuant to Paragraph XIV.B. of this Agreement.
- (3) If a transfer, alone or together with other previous, simultaneous, or proposed transfers, would have the effect of transferring a controlling interest in the Restaurant, interest in this Agreement, or in the franchise rights or license rights granted hereunder, or in Franchisee, Franchisor may, in its sole discretion, if it does not elect to exercise its option to purchase set forth in Paragraph XIII.C. herein, require any or all of the following as conditions of its approval:
- (a) All of Franchisee's accrued and outstanding monetary obligations to third parties and all accrued and outstanding obligations to Franchisor, or any parent, subsidiary or affiliate of Franchisor shall have been satisfied;
- (b) Franchisee shall not be in default of any provision of this Agreement, any amendment hereto or successor hereof, or any other agreement between Franchisee and Franchisor, its parents, subsidiaries, or affiliates;
- (c) The transferor shall have executed a general release under seal, in a form satisfactory to Franchisor, of any and all claims against Franchisor and its officers, directors, shareholders, and employees, in their corporate and individual capacities, including, without limitation, claims arising under federal, state, and local laws, rules, and ordinances; and shall agree to remain liable to Franchisor for all affirmative obligations, covenants, and agreements contained herein for two (2) years following the effective date of transfer (or, if transferor retains a purchase money interest in the transferred business, for a period greater than two (2) years, until the interest is extinguished) or for such shorter period as Franchisor may, in its sole discretion, determine;
- (d) The transferee shall enter into a written assignment, under seal and in a form satisfactory to Franchisor, assuming and agreeing to discharge all of Franchisee's
obligations under this Agreement; and, if the obligations of Franchisee were guaranteed by the transferor, the transferee shall guarantee the performance of all such obligations in writing in a form satisfactory to Franchisor;
- (e) The transferee shall demonstrate to Franchisor's satisfaction that the transferee meets Franchisor's educational, managerial, and business standards; possesses a good moral character, business reputation, and credit rating;
Source: Item 23 — RECEIPTS (FDD pages 82–573)
What This Means (2025 FDD)
According to Bojangles's 2025 Franchise Disclosure Document, if a transfer of a Bojangles restaurant, agreement, or franchise rights would result in a transfer of controlling interest, Bojangles has specific requirements that must be met for approval. Before the transfer can be approved, all of the franchisee's accrued and outstanding monetary obligations to third parties and all accrued and outstanding obligations to Bojangles, or any parent, subsidiary or affiliate of Bojangles must be satisfied.
Additionally, the franchisee must not be in default of any provision of the Franchise Agreement, any amendment to it, or any other agreement between the franchisee and Bojangles, its parents, subsidiaries, or affiliates. The transferor must execute a general release under seal, in a form satisfactory to Bojangles, releasing any and all claims against Bojangles and its officers, directors, shareholders, and employees, in their corporate and individual capacities, including claims arising under federal, state, and local laws, rules, and ordinances. The transferor must also agree to remain liable to Bojangles for all affirmative obligations, covenants, and agreements contained in the franchise agreement for two years following the transfer date, or longer if the transferor retains a purchase money interest in the transferred business until that interest is extinguished, unless Bojangles determines a shorter period.
Furthermore, the transferee must enter into a written assignment, under seal and in a form satisfactory to Bojangles, assuming and agreeing to discharge all of the franchisee's obligations under the Franchise Agreement. If the obligations of the franchisee were guaranteed by the transferor, the transferee must guarantee the performance of all such obligations in writing in a form satisfactory to Bojangles. These conditions are put in place to ensure the transferee's full performance of the obligations under the agreement.