What is the relationship between the Bojangles's Item 5 development fee and the franchisor's pre-opening obligations described in Item 11?
Bojangles Franchise · 2025 FDDAnswer from 2025 FDD Document
velopment Fee
You must pay a development fee of $10,000 for each Restaurant that we authorize you to develop when you sign the Development Agreement regardless of whether you actually develop Restaurants after that time. When you sign the Development Agreement, you also will sign a Franchise Agreement for the first Restaurant that you plan to develop.
The development fee is fully earned and non-refundable in consideration of administrative and other expenses we incur in entering into the Development Agreement and for our lost or deferred opportunity to enter into the Development Agreement with others.
During our previous fiscal year, the development fee paid to us for each Restaurant under applicable development agreements was $10,000 for our standard development.
Franchise Fee
Under the Franchise Agreement, you must pay a franchise fee of $35,000 by the construction commencement deadline of the traditional Restaurant that you agreed to develop according to the development schedule in your Development Agreement. We will credit the development fee that you paid for each Restaurant that you develop under the Development Agreement against the franchise fee that you pay for that Restaurant if you sign the Franchise Agreement and pay the applicable franchise fee by the time you commence construction of the Restaurant.
The franchise fee for each Individual Franchise Agreement is $35,000 and is payable upon execution of the Individual Franchise Agreement.
You must pay a franchise fee of $20,000 when you sign the Bojangles Express Franchise Agreement for a Bojangles Express Restaurant.
All franchise fees are fully earned and non-refundable when paid.
Some franchisees may be "grandfathered" under earlier agreements that establish franchise fees, royalties and contributions to the Marketing Development Fund in amounts less than described in this disclosure document.
During our previous fiscal year, the franchise fee paid us for each Bojangles Express Restaurant was $20,000 and the franchise fee paid to us for all other Restaurants ranged from $25,000 (for certain franchisees grandfathered into previously negotiated terms) to $35,000 per Restaurant.
What This Means (2025 FDD)
According to Bojangles's 2025 Franchise Disclosure Document, the development fee paid under the Development Agreement affects the franchise fee and is related to Bojangles's pre-opening obligations. A franchisee must pay a development fee of $10,000 for each restaurant they are authorized to develop when signing the Development Agreement. This fee is earned upon receipt.
The development fee can be credited towards the franchise fee. The franchise fee is $35,000 and is due by the construction commencement deadline for a traditional restaurant. If the franchisee adheres to the development schedule and signs the Franchise Agreement, the $10,000 development fee paid for each restaurant under the Development Agreement will be credited against the franchise fee for that restaurant.
Bojangles's pre-opening obligations, outlined in Item 11, include designating the number of restaurants (at least three) and the assigned development area, as well as approving or disapproving the specific location of each restaurant. Bojangles also provides reasonable site selection assistance and counseling upon request. They will approve or disapprove the site within 45 days of receiving the site approval application.
In summary, the development fee is a prerequisite for entering into a Development Agreement with Bojangles, granting the franchisee the right to develop multiple restaurants within an assigned area. Payment of this fee initiates Bojangles's pre-opening obligations, such as site selection assistance and plan specifications. Furthermore, the development fee serves as a credit towards the franchise fee, incentivizing franchisees to proceed with the development and opening of their restaurants.