Where can I find the provisions regarding renewal, termination, transfer, and dispute resolution for a Bambu franchise?
Bambu Franchise · 2025 FDDAnswer from 2025 FDD Document
eements. You should read these provisions in the Franchise Agreement and related agreements attached to this Disclosure Document.
| | Provision | Section in Franchise Agreement or Multi-Unit Development Agreement | Summary | |-----|------------------------------------------------|------------------------------------------------------------------------------------------------------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------| | (a) | Length of the franchise term | Section 18.1 of Franchise Agreement ("FA"); Section 4.1 of Multi-Unit Development Agreement ("MUDA") | 10 years for the Franchise Agreement. For the MUD Agreement, the term extends until the earlier of the date that you sign the Franchise Agreement for the final Bambū shoppe to be developed under the MUD Agreement or the deadline in the development schedule for signing that Franchise Agreement. | | (b) | Renewal or extension of the term | Sections 18.3 and 18.4 of FA | If you meet certain criteria, you may acquire successor franchise rights for the term stated in the then current Franchise Agreement. | | (c) | Requirements for franchisee to renew or extend | Section 18.3 of FA | Provide notice to us, no more than 3 defaults, remodel shoppe, attend additional training, pay fee, sign new agreement and a Successor Franchise Rider in the form attached as Exhibit E containing a release. If you seek to acquire successor franchise rights, you may be required to sign a contract with materially different terms and conditions than your original contract. | | (d) | Termination by franchisee | Section 4.2 of MUDA | For the Franchise Agreement: Not applicable. For the MUD Agreement: You may terminate for any reason upon 60 days' notice. (Subject to state law.) | | (e) | Termination by franchisor without cause | Not applicable | Not applicable | | (f) | Termination by franchisor with cause | Sections 19.1 and 19.2 of FA; Sections 4.3 and 4.4 of MUDA | We can terminate only if you commit any one of several listed violations. | | (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. |
| 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. |
| (i) | Franchisee's obligations on termination/non-renewal | Sections 19.3 and 19.4 of FA; Section 4.5 of MUDA | Pay outstanding amounts; pay an amount equal to the monthly Royalty Fees due over the remaining term under the Franchise Agreement if terminated due to your default; de-identification of shoppe; return of confidential information; covenant not to compete (see also o. and r. below); others. |
| (j) | Assignment of contract by franchisor | Section 17.6 of FA; Section 5.1 of MUDA | No restriction on our right to assign. |
| (k) | "Transfer" by franchisee – defined | Section 17.1 of FA; Section 5.2 of MUDA | Includes transfer of franchise agreement or shoppe, any change in ownership of franchisee entity, or the transfer of the assets of the shoppe. |
| (1) | Franchisor approval of transfer by franchisee | Sections 17.3 and 17.8 of FA; Section 5.2 of MUDA | We have the right to approve all transfers, we may not unreasonably withhold our consent. We have the right to approve any public or private offering. |
| (m) | Conditions for franchisor approval of transfer | Sections 17.2 and 17.8 of FA; Sections 5.2 and 5.3 of MUDA | For the Franchise Agreement: The following conditions will apply: Timely notice to us, transferee qualifies, all amounts due are paid in full and any defaults cured, transferee completes training, transfer fee paid, then current contract signed (which may contain terms and conditions materially different from the original Franchise Agreement), franchisee signs general release, noncompetition covenant, if requested upgrade shoppe, transferor remains liable. Review of public or private offering materials. For the MUD Agreement: The following conditions will apply in addition to those listed above: Fee for each undeveloped Bambū shoppe paid. |
| (n) | Franchisor's right of first refusal to acquire franchisee's business | Section 17.4 of FA; Section 5.4 of MUDA | For a 30 day period, we have the right to match third party offer. |
| (o) | Franchisor's option to purchase franchisee's business | Section 19.3 | We may buy your Bambū shoppe or a portion of the assets of the Bambū shoppe upon termination or non-renewal. |
Source: Item 17 — (FDD pages 44–46)
What This Means (2025 FDD)
According to Bambu's 2025 Franchise Disclosure Document, Item 17 provides a summary of the provisions in the Franchise Agreement and Multi-Unit Development Agreement related to renewal, termination, transfer, and dispute resolution. This item directs prospective franchisees to review the actual agreements attached to the Disclosure Document for the complete terms. The table in Item 17 outlines key provisions with references to specific sections in the Franchise Agreement (FA) and Multi-Unit Development Agreement (MUDA).
Regarding renewal, the franchise term is 10 years, as detailed in Section 18.1 of the FA and Section 4.1 of the MUDA. Franchisees who meet certain criteria can acquire successor franchise rights for a term stated in the then-current Franchise Agreement, as specified in Sections 18.3 and 18.4 of the FA. To renew, franchisees must provide notice, have no more than 3 defaults, remodel the shoppe, attend additional training, pay a fee, and sign a new agreement and a Successor Franchise Rider, including a release, as outlined in Section 18.3 of the FA.
Concerning termination, a franchisee may terminate the MUD Agreement for any reason with 60 days' notice, subject to state law, as stated in Section 4.2 of the MUDA. Bambu can terminate the Franchise Agreement if the franchisee commits any of several listed violations, according to Sections 19.1 and 19.2 of the FA and Sections 4.3 and 4.4 of the MUDA. The conditions constituting cause for termination, whether curable or non-curable, are detailed in Sections 19.1 and 19.2 of the FA and Section 4.3 of the MUDA.
With respect to transfer, a franchisee's death or disability requires the franchise to be assigned to an approved buyer within 180 days, as per Section 17.7 of the FA. Any transfer of the franchise agreement, shoppe ownership, or assets is subject to Bambu's approval, which will not be unreasonably withheld, as indicated in Sections 17.3 and 17.8 of the FA and Section 5.2 of the MUDA. Bambu also retains the right of first refusal to acquire the franchisee's business for a 30-day period, matching any third-party offer, as described in Section 17.4 of the FA and Section 5.4 of the MUDA.
For dispute resolution, Article 23 of the FA and Section 8.1 of the MUDA specify that disputes will be resolved through arbitration or litigation in Denver, Colorado, under Colorado law, with both parties waiving their rights to a jury trial, subject to applicable state law. The Colorado Consumer Protection Act does not apply, as stated in Section 23.5 of the FA and Section 8.1 of the MUDA. These provisions are subject to state law.