For how long after the transfer of a Bojangles franchise does the transferor remain liable to Bojangles for affirmative obligations?
Bojangles Franchise · 2025 FDDAnswer from 2025 FDD Document
- (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;
Source: Item 22 — CONTRACTS (FDD page 82)
What This Means (2025 FDD)
According to Bojangles's 2025 Franchise Disclosure Document, a transferor (the seller) of a Bojangles franchise remains liable to Bojangles for all affirmative obligations, covenants, and agreements contained in the franchise agreement for a period of two years following the effective date of the transfer. However, there are a couple of exceptions to this general rule.
First, if the transferor retains a purchase money interest in the transferred business, the liability extends for a period greater than two years, specifically until the purchase money interest is extinguished. This means that if the seller finances part of the buyer's acquisition of the franchise, their liability continues until that financing is fully repaid. Second, Bojangles retains the discretion to shorten this liability period.
In practical terms, this means that someone selling their Bojangles franchise could still be on the hook for certain obligations even after the sale is complete. This could include things like ongoing royalties, advertising contributions, or compliance with brand standards. The duration of this extended liability depends on whether the seller provides financing to the buyer and on Bojangles's specific determination in the transfer agreement. A prospective franchisee should carefully review the transfer agreement and consult with legal counsel to fully understand the scope and duration of their potential liability after transferring a franchise.