Under what circumstances can Bojangles terminate the franchise agreement immediately without allowing the franchisee an opportunity to cure the default?
Bojangles Franchise · 2025 FDDAnswer from 2025 FDD Document
XIV. DEFAULT AND TERMINATION
- A. Franchisee shall be deemed to be in default under this Agreement, and all rights granted herein shall automatically terminate without notice to Franchisee, if Franchisee shall become insolvent or make a general assignment for the benefit of creditors; or if a petition in bankruptcy is filed by Franchisee or such a petition is filed against Franchisee and not opposed by Franchisee; or if Franchisee is adjudicated a bankrupt or insolvent; or if a bill in equity or other proceeding for the appointment of a receiver of Franchisee or other custodian for Franchisee's business or assets is filed and consented to by Franchisee; or if a receiver or other custodian (permanent or temporary) of Franchisee's assets or property, or any part thereof, is appointed by any court of competent jurisdiction; or if proceedings for a composition with creditors under any state or federal law should be instituted by or against Franchisee.
- B. Upon occurrence of any of the following events, Franchisee shall be deemed to be in default and Franchisor may, at its option, terminate this Agreement and all rights granted hereunder, without affording Franchisee any opportunity to cure the default, effective immediately upon receipt of notice by Franchisee:
- (1) If Franchisee fails to: obtain Franchisor's approval of a site for the Restaurant by the Site Approval Deadline; commence construction of the Restaurant and pay the Franchise Fee by the Construction Commencement Deadline; or construct, furnish, and open the Restaurant by the Opening Deadline;
- (2) If Franchisee or any shareholder or member of Franchisee is convicted of a felony, a crime involving moral turpitude, or any other crime or offense that is reasonably likely, in the sole opinion of Franchisor, adversely to affect the System, the Proprietary Marks, the Trade Dress the goodwill associated therewith, or Franchisor's interest therein;
- (3) If Franchisee or any shareholder or member of Franchisee purports to transfer any interest in this Agreement, any rights hereunder, including but not limited to any rights to operate the Restaurant, franchise and license rights or obligations under this Agreement or any
Source: Item 22 — CONTRACTS (FDD page 82)
What This Means (2025 FDD)
According to Bojangles's 2025 Franchise Disclosure Document, there are specific instances where Bojangles can terminate the franchise agreement immediately, without providing the franchisee an opportunity to correct the issue. These situations involve critical failures or actions that significantly impact the brand or the agreement itself.
Bojangles can immediately terminate the agreement if the franchisee becomes insolvent, makes an assignment for the benefit of creditors, files for bankruptcy (or doesn't oppose an involuntary petition), is adjudicated bankrupt or insolvent, consents to the appointment of a receiver, or institutes proceedings for composition with creditors. These scenarios indicate severe financial distress, posing a risk to Bojangles's reputation and financial interests.
Additionally, Bojangles can terminate the agreement immediately if the franchisee fails to meet certain deadlines, such as obtaining site approval, commencing construction, or opening the restaurant. Immediate termination is also warranted if the franchisee or any shareholder/member is convicted of a felony or a crime involving moral turpitude that could adversely affect the Bojangles system. Furthermore, any unauthorized transfer of interest in the agreement also allows for immediate termination by Bojangles.