If a transfer of a Bojangles franchise would result in a change of controlling interest, what options does Bojangles have?
Bojangles Franchise · 2025 FDDAnswer from 2025 FDD Document
[Item 22: CONTRACTS]
(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 right to operate 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 XV.D. 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, it 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 or members, 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;
Source: Item 22 — CONTRACTS (FDD page 82)
What This Means (2025 FDD)
According to Bojangles's 2025 Franchise Disclosure Document, if a transfer of interest would result in a change of controlling interest in the restaurant, the agreement, or the franchise rights, Bojangles has options. Bojangles may choose not to exercise its option to purchase the franchise. If Bojangles does not exercise that option, it can require certain conditions of approval for the transfer.
These conditions include ensuring that all of the franchisee's outstanding monetary obligations to third parties and to Bojangles (or its affiliates) are satisfied. The franchisee must not be in default of any provision of the Franchise Agreement or any other agreement with Bojangles or its affiliates. The transferor must execute a general release of all claims against Bojangles and its related parties, agreeing to remain liable for obligations for two years after the transfer (or longer if they retain a purchase money interest).
Additionally, the transferee must enter into a written assignment, agreeing to fulfill all of the franchisee's obligations under the Franchise Agreement. If the transferor had guaranteed the franchisee's obligations, the transferee must also provide a written guarantee in a form satisfactory to Bojangles. These stipulations ensure that Bojangles maintains control over who operates its franchises and that both the outgoing and incoming parties meet certain financial and legal obligations.