Under what circumstances is a Bojangles franchisee required to obtain and deliver covenants similar to those in Paragraph XVI to Bojangles, and from whom must these covenants be obtained?
Bojangles Franchise · 2025 FDDAnswer from 2025 FDD Document
G. At the request of Franchisor, Franchisee shall obtain and deliver to Franchisor executed covenants similar in substance to those set forth in this Paragraph XVI. (including covenants applicable upon the termination of a person's relationship with Franchisee) from the following persons: all officers, directors, or members, and holders of the securities of Franchisee, and of any corporation or limited liability company directly or indirectly controlling or controlled by Franchisee. Every covenant required by this Paragraph XVI.G. shall be in a form satisfactory to Franchisor, including, without limitation, specific identification of Franchisor as a third-party beneficiary of such covenants with the independent right to enforce them. Failure by Franchisee to obtain execution of a covenant required by this Paragraph XVI.G. or to deliver the covenant to Franchisor shall constitute a default under this Agreement.
Source: Item 22 — CONTRACTS (FDD page 82)
What This Means (2025 FDD)
According to Bojangles's 2025 Franchise Disclosure Document, a franchisee is required to obtain and deliver executed covenants to Bojangles that are similar in substance to those outlined in Paragraph XVI of the franchise agreement. This requirement is triggered at the request of Bojangles.
The individuals from whom these covenants must be obtained include all officers, directors, or members, and holders of the securities of the franchisee. Additionally, covenants must be secured from any corporation or limited liability company that directly or indirectly controls, or is controlled by, the franchisee.
The covenants must be in a form that is satisfactory to Bojangles, which includes specifically identifying Bojangles as a third-party beneficiary with the independent right to enforce these covenants. Failure to obtain these covenants or deliver them to Bojangles constitutes a default under the Franchise Agreement, which could lead to penalties or termination of the agreement.