How does the Bojangles's Item 7 estimated initial investment relate to the franchisor's litigation in Item 3?
Bojangles Franchise · 2025 FDDAnswer from 2025 FDD Document
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Without admitting any wrongdoing, or that any supplemental disclosure was required to be made, Bojangles', Inc. made certain supplemental disclosures in a Form 8-K that filed with the SEC on December 31, 2018. After the supplemental disclosures were filed, Plaintiff filed an amended complaint that continued to assert disclosure claims related to the proxy and challenge the adequacy of the merger consideration. Plaintiff thereafter obtained discovery relating to whether the disclosed financial projections fully and properly accounted for Bojangles' restaurant portfolio optimization plan announced in July 2018. After reviewing the discovery, Plaintiff agreed to dismiss its claims as moot. Bojangles', Inc. agreed to pay a mootness fee of $75,000 in October 2019 for full satisfaction of any claims by Plaintiff or Plaintiff's counsel for fees, expenses or costs. The matter was thereafter dismissed as moot on October 30, 2019.
Other than these four actions, no litigation is required to be disclosed in
What This Means (2025 FDD)
According to Bojangles's 2025 Franchise Disclosure Document, Item 7 details the estimated initial investment required to open a restaurant, while Item 3 discloses any litigation the franchisor has been involved in. However, the provided excerpts do not discuss any specific connection or relationship between the estimated initial investment figures in Item 7 and the litigation disclosed in Item 3. Item 3 describes a specific instance where Bojangles', Inc. made supplemental disclosures in a Form 8-K filed with the SEC on December 31, 2018, leading to an amended complaint and subsequent dismissal after Bojangles', Inc. agreed to pay a mootness fee of $75,000 in October 2019.
Item 7 provides a detailed breakdown of the costs associated with opening a Bojangles restaurant, including franchise fees, insurance, site selection, building costs, and initial inventory. These costs are presented as estimates and can vary significantly based on the location and type of restaurant (traditional or Bojangles Express). The document emphasizes that these are estimates and recommends that prospective franchisees consult with business advisors and legal counsel to review these figures carefully.
Without further information, it's impossible to determine if the litigation history has any direct impact on the estimated initial investment. A prospective franchisee should inquire with Bojangles about whether the litigation history has led to any changes in the costs associated with opening a franchise, such as increased insurance premiums or stricter compliance requirements. Understanding the potential financial implications of any past or ongoing litigation is a crucial part of due diligence before investing in a franchise.