During the term of the Bojangles agreement, is a franchisee allowed to own or invest in a restaurant business that sells fried chicken within 10 miles of a Bojangles restaurant?
Bojangles Franchise · 2025 FDDAnswer from 2025 FDD Document
vision of law.
- H. Franchisee shall comply with any surviving covenants contained in Paragraph XVI. of this Agreement.
XVI. COVENANTS
- A. Franchisee acknowledges that, pursuant to this Agreement, Franchisee will receive valuable specialized training and confidential information, including, without limitation, information relating to the operational, sales, promotional, and marketing methods and techniques of Franchiser and the System. Accordingly, Franchisee covenants that:
- (1) During the term of this Agreement, except as otherwise approved in writing by Franchisor, Franchisee and its shareholders or members shall not, either directly or indirectly, for themselves, or through, on behalf of, or in conjunction with any person, persons, partnership, corporation or limited liability company:
- (a) Divert or attempt to divert any business or customer of the Restaurant to any competitor, by direct or indirect inducement or otherwise, or do or perform, directly or indirectly, any other act injurious or prejudicial to the goodwill associated with Franchisor's Proprietary Marks, Trade Dress and the System; or
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- (b) Own, maintain, advise, help, invest in, make loans to, be employed by, be the landlord of, engage in, or have any interest in:
- (i) Any restaurant business which: (a) competes with any Bojangles restaurant or which sells fried chicken, biscuits and/or biscuit sandwiches, or other items which are featured menu items at Bojangles restaurants; and (b) is located within ten (10) miles from the Restaurant or any Bojangles restaurant that is open, planned for construction or under construction; or
- (ii) Any fast food restaurant business which is located (a) within ten (10) miles from the Restaurant or any Bojangles restaurant that is open, planned for construction, or under construction, or (b) within the designated market area within which the Restaurant is situated.
Source: Item 23 — RECEIPTS (FDD pages 82–573)
What This Means (2025 FDD)
According to Bojangles's 2025 Franchise Disclosure Document, during the term of the agreement, a franchisee and their shareholders or members are generally prohibited from owning or investing in any restaurant business that competes with Bojangles or sells fried chicken, biscuits, and/or biscuit sandwiches within a 10-mile radius of a Bojangles restaurant. This restriction applies to any Bojangles restaurant that is open, planned for construction, or under construction. This is to protect Bojangles' market and prevent franchisees from diverting business to competitors.
This restriction also extends to any fast-food restaurant business located within the same 10-mile radius or within the designated market area where the Bojangles restaurant is situated. However, there is an exception: franchisees can own less than 2% of the equity securities of a corporation registered under the Securities Exchange Act of 1934 without violating this covenant.
These covenants are designed to protect Bojangles' confidential information, trade dress, and overall system. Franchisees receive specialized training and access to operational, sales, promotional, and marketing methods, making these restrictions necessary to maintain the brand's integrity and competitive advantage. Franchisees need to be aware of these restrictions to avoid potential breaches of the agreement, which could lead to termination or other penalties.