What is Bambu entitled to do if the franchisee defaults in any term of the Franchise Agreements?
Bambu Franchise · 2025 FDDAnswer from 2025 FDD Document
se rights. Upon the expiration of this Agreement, Franchisee shall comply with the provisions of Section 19.4 below.
19. DEFAULT AND TERMINATION
- 19.1 Termination by Bambu Effective Upon Notice. Bambu shall have the right, at its option, to terminate this Agreement and all rights granted Franchisee hereunder, without affording Franchisee any opportunity to cure any default (except where expressly indicated and subject to any state laws to the contrary, where state law shall prevail), effective upon notice to Franchisee upon the occurrence of any of the following events:
- a. Abandonment. If Franchisee ceases to operate the Bambū shoppe or otherwise abandons the Bambū shoppe for a period of three consecutive days, or any shorter period that indicates an intent by Franchisee to discontinue operation of the Bambū shoppe. Franchisee's suspension or termination of the shoppe's operation due to fire, flood, earthquake, epidemic or pandemic, or force majeure shall not be deemed abandonment.
- b. No Bambū Certified Team Leaders Present. No Bambū Certified Team Leaders are present at, or are available upon Bambu's demand to be present at, the Bambū shoppe for three consecutive days.
- c. Insolvency; Assignments. If Franchisee becomes insolvent or is adjudicated a bankrupt; or if any action is taken by Franchisee, or by others against Franchisee under any insolvency, bankruptcy or reorganization act, (this provision may not be enforceable under federal bankruptcy law, 11 U.S.C. §§ 101 et seq.); or if Franchisee makes an assignment for the benefit of creditors or a receiver is appointed by Franchisee.
- d. Unsatisfied Judgments; Levy; Foreclosure. If any material judgment (or several judgments which in the aggregate are material) is obtained against Franchisee and remains unsatisfied or of record for 30 days or longer (unless a supersedeas or other appeal bond has been filed); or if execution is levied against Franchisee's business or any of the property used in the operation of the Bambū shoppe and is not discharged within five days; or if the real or personal property of Franchisee's business shall be sold after levy thereupon by any sheriff, marshal or constable.
- e. Criminal Conviction.
Source: Item 23 — Receipts (FDD pages 52–209)
What This Means (2025 FDD)
According to the 2025 Bambu Franchise Disclosure Document, Bambu has the right to terminate the Franchise Agreement if a franchisee defaults. Specifically, Bambu can terminate the agreement and all rights granted to the franchisee without providing an opportunity to cure the default, except where expressly indicated and subject to state laws. This termination is effective upon notice to the franchisee.
Several events can trigger immediate termination by Bambu. These include abandonment of the Bambu shop for three consecutive days or any shorter period indicating an intent to discontinue operations. Termination can also occur if no Bambu Certified Team Leaders are present or available at the shop for three consecutive days. Insolvency or assignments by the franchisee can also lead to termination.
Other causes for termination relate to misuse of Bambu's marks, unauthorized disclosure of confidential information, or violation of restrictive covenants. Repeated noncompliance after two previous notices of default can also result in termination. Additionally, a franchisee's default regarding amounts owed to third parties may be considered a default under the Franchise Agreement, allowing Bambu to pursue all available remedies.