What standards must a transferee meet to be approved by Bojangles for a development agreement transfer?
Bojangles Franchise · 2025 FDDAnswer from 2025 FDD Document
- (1) Developer understands and acknowledges that the rights and duties set forth in this Agreement are personal to Developer and its shareholders or members, and that Franchisor has granted this Agreement in reliance on Developer's business skill and financial capacity, and the business skill, financial capacity and personal character of Developer's shareholders or members. Accordingly, neither Developer nor any immediate or remote successor to any part of Developer's interest in this Agreement, nor any individual, partnership, corporation, limited liability company or other legal entity which directly or indirectly owns any interest in this Agreement or in Developer shall sell, assign, transfer, convey, give away, pledge, mortgage, or otherwise encumber any direct or indirect interest in this Agreement, any rights or obligations hereunder or in Developer without the prior written consent of Franchisor, which consent shall not be unreasonably withheld. Any such proposed transfer shall be subject, where applicable, to Franchisor's option to purchase set forth in Paragraph IX.C. hereof. Any purported assignment or transfer, by operation of law or otherwise, not having the written consent of Franchisor required by this Paragraph IX. shall be null and void and shall constitute a material breach of this Agreement, for which Franchisor may then terminate without opportunity to cure pursuant to Paragraph VIII.C. of this Agreement.
- (2) If a transfer, alone or together with other previous, simultaneous, or proposed transfers, would have the effect of transferring a controlling interest in Developer, interest in this Agreement, any rights or obligations hereunder or any Restaurant developed under
this Agreement, Franchisor may, in its sole discretion, if it does not elect to exercise its option to purchase set forth in Paragraph IX.C. hereof, require any or all of the following as conditions of its approval:
- (a) All of Developer'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) Developer shall not be in default of any provision of this Agreement, any amendment hereto or successor hereof, or any other agreement between Developer 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 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 Developer's obligations under this Agreement; and, if the obligations of Developer 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; has the aptitude and ability to conduct the business which is the subject of this Agreement (as may be evidenced by prior related business experience or otherwise); and has adequate financial resources and capital to develop Restaurants hereunder;
Source: Item 23 — RECEIPTS (FDD pages 82–573)
What This Means (2025 FDD)
According to Bojangles's 2025 Franchise Disclosure Document, a transferee must meet several standards to be approved for a development agreement transfer. The transferee must demonstrate to Bojangles's satisfaction that they meet the brand's educational, managerial, and business standards. They must also possess a good moral character, business reputation, and credit rating.
Furthermore, the transferee needs to show that they have the aptitude and ability to conduct the Bojangles business, potentially evidenced by prior related business experience. They must also have adequate financial resources and capital to develop Restaurants under the development agreement. The transferee's Managing Owner, Designated Operator, and managers must complete any training and certification programs then in effect for developers upon such terms and conditions as Bojangles may reasonably require.
In addition to meeting these standards, the transferee must enter into a written assignment, in a form satisfactory to Bojangles, agreeing to fulfill all of the developer's obligations under the existing development agreement. If the original developer's obligations were guaranteed, the transferee must also provide a written guarantee in a form satisfactory to Bojangles. At Bojangles's option, the transferee may be required to execute Bojangles's then-current standard form of development agreement or an agreement in the form of the existing agreement, along with a guarantee from all shareholders or members of the transferee. The development schedule and assigned area will remain the same as in the original agreement, and the transferee must also execute any other ancillary agreements that Bojangles may require.
Finally, the transferee must acquire all of the Restaurants opened under the Development Agreement and all of the Developer's rights granted under all of its Franchise Agreements with Bojangles. The developer is also required to pay Bojangles a transfer fee of $5,000 per Restaurant to cover Bojangles's costs and expenses related to reviewing the transfer application. Bojangles emphasizes that each of these conditions is necessary to ensure the transferee's full performance of the obligations under the development agreement.