What constitutes a breach of the Bambu Franchise Agreement regarding Co-op participation?
Bambu Franchise · 2025 FDDAnswer from 2025 FDD Document
If a Co-op is established for the area where Franchisee is located, Franchisee will be required to participate in the Co-op for the purpose of selecting and participating in regional marketing and promotion programs for Bambū shoppes, which programs and other Co-op activities are subject to the approval of Bambu.
Franchisee will be required to remain a member of and be bound by the decisions of the majority of the members of the Co-op regarding expenditures, assessments and dues of the Co-op, to the extent that they are approved by Bambu.
Each Co-op has the right, by majority vote, to require its members to pay monthly dues to the Co-op.
The failure of Franchisee to participate in the Co-op or pay any dues required by the Co-op, may be deemed to be a breach of this Agreement.
Source: Item 23 — Receipts (FDD pages 52–209)
What This Means (2025 FDD)
According to Bambu's 2025 Franchise Disclosure Document, if a regional advertising association (Co-op) is established for the area where a franchisee's location is, the franchisee is required to participate in the Co-op. This participation involves selecting and engaging in regional marketing and promotion programs for Bambu shops, with these programs and Co-op activities being subject to Bambu's approval. Franchisees must remain members of the Co-op and adhere to the decisions made by the majority of its members regarding expenditures, assessments, and dues, provided these decisions are approved by Bambu.
The franchise agreement stipulates that each Co-op has the authority, through a majority vote, to mandate its members to pay monthly dues. Therefore, a breach of the Bambu Franchise Agreement occurs if a franchisee fails to participate in the Co-op or neglects to pay any dues required by the Co-op.
Bambu retains the right to determine the composition of geographic territories and market areas for regional advertising campaigns and can require franchisees to participate in these programs when established. This means that participation in the Co-op and payment of dues are not optional if Bambu mandates them, and failure to comply can result in a breach of the franchise agreement.