During the term of the Bojangles agreement, can a franchisee or their shareholders/members own or invest in a restaurant that sells fried chicken within 10 miles of a Bojangles restaurant?
Bojangles Franchise · 2025 FDDAnswer from 2025 FDD Document
pliance with any provision 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 22 — CONTRACTS (FDD page 82)
What This Means (2025 FDD)
According to the 2025 Bojangles Franchise Disclosure Document, during the term of the agreement, a franchisee and their shareholders or members are restricted from owning or investing in certain competing businesses. Specifically, unless Bojangles approves it in writing, the franchisee cannot own, maintain, advise, help, invest in, make loans to, be employed by, be the landlord of, engage in, or have any interest in a restaurant business that competes with Bojangles or sells fried chicken, biscuits, and/or biscuit sandwiches if that business is located within 10 miles of a Bojangles restaurant that is open, planned for construction, or under construction.
This restriction also applies to any fast food restaurant business located within 10 miles of a Bojangles restaurant or within the designated market area of the Bojangles restaurant. This means a franchisee's ability to invest in or operate other food service businesses is significantly limited during the term of the franchise agreement.
However, there is an exception: the franchisee can own less than two percent beneficial interest in the outstanding equity securities of any corporation which is registered under the Securities Exchange Act of 1934. This allows for minor investments in publicly traded companies, even if they compete with Bojangles. These covenants are construed as independent of any other covenant or provision of the agreement.