What constitutes 'cause' for termination of the Bambu Franchise Agreement, and what are the cure periods for defaults?
Bambu Franchise · 2025 FDDAnswer from 2025 FDD Document
| Provision | Section in Franchise Agreement or Multi-Unit Development Agreement | Summary | |
|---|---|---|---|
| (h) | "Cause" defined-non-curable defaults | Section 19.1 of FA | For the Franchise Agreement: Unauthorized disclosure, conviction of a crime, abandonment, no Bambū Certified Team Leaders are present at or available to be at the Bambū shoppe for three consecutive days, unapproved transfers, bankruptcy 1 , assignment for benefit of creditors, unsatisfied judgments, levy, foreclosure, repeated violations, violate restrictive covenants, two insufficient funds checks, health and safety, misrepresentations, sexual harassment or discrimination, breach of other agreements between us or any of our affiliates and you or any of your affiliates, guaranty becomes unenforceable or inadequate, you become subject to the PATRIOT Act. |
| (g) | "Cause" defined-curable defaults | Sections 19.1 and 19.2 of FA; Section 4.3 of MUDA | For the Franchise Agreement: 48 hours for misuse of the Marks, purchases from unapproved suppliers, or other failures to comply with FRC Materials or other standards, 5 days for monetary defaults, 7 days for filing of a legal action in violation of the dispute resolution terms in the Franchise Agreement, and generally 30 days for other defaults. For the Development Agreement: 30 days' notice for breach. If we provide you with a notice of default, we and our affiliates may suspend services to you until each default is cured. |
Source: Item 17 — (FDD pages 44–46)
What This Means (2025 FDD)
According to Bambu's 2025 Franchise Disclosure Document, 'cause' for termination is divided into curable and non-curable defaults. Non-curable defaults under Section 19.1 of the Franchise Agreement include unauthorized disclosure, conviction of a crime, abandonment, not having Bambū Certified Team Leaders present at the shoppe for three consecutive days, unapproved transfers, bankruptcy, assignment for benefit of creditors, unsatisfied judgments, levy, foreclosure, repeated violations, violating restrictive covenants, two insufficient funds checks, health and safety violations, misrepresentations, sexual harassment or discrimination, breach of other agreements between Bambu or its affiliates and the franchisee or their affiliates, if a guaranty becomes unenforceable or inadequate, or if the franchisee becomes subject to the PATRIOT Act.
Curable defaults, as detailed in Sections 19.1 and 19.2 of the Franchise Agreement, have specific cure periods. A franchisee has 48 hours to cure defaults related to misuse of the Marks, purchases from unapproved suppliers, or other failures to comply with FRC Materials or other standards. For monetary defaults, the cure period is 5 days. If a franchisee files a legal action violating the dispute resolution terms in the Franchise Agreement, they have 7 days to cure the default. For other defaults not specifically mentioned, a franchisee generally has 30 days to cure the default.
It is important to note that if Bambu provides a notice of default, Bambu and its affiliates may suspend services to the franchisee until each default is cured. Prospective franchisees should carefully review Sections 19.1 and 19.2 of the Franchise Agreement to fully understand the circumstances that could lead to termination and the applicable cure periods, as these can significantly impact the operation and financial stability of their Bambu franchise.