Following the termination or expiration of a Bambu franchise agreement, what is the deadline for the franchisee to pay all outstanding fees, inventory, supply purchases, and other charges owed to Bambu or its affiliates?
Bambu Franchise · 2025 FDDAnswer from 2025 FDD Document
- 19.4 Obligations of Franchisee Upon Termination or Expiration. Franchisee is obligated upon termination or expiration of this Agreement to immediately:
- a. Pay to Bambu all fees, inventory and supply purchases and other charges owed to Bambu or its affiliates pursuant to this Agreement, or pursuant to any other agreement, whether written or oral, including subleases and lease assignments, between the parties, within 10 days of the date of termination or expiration. In the event of a termination due to a default by Franchisee, the amounts owed to Bambu shall include an amount equal to the monthly Royalty Fees that would have been payable for each month from the date of termination until the expiration date that would apply to this Agreement had it not been terminated.
Source: Item 23 — Receipts (FDD pages 52–209)
What This Means (2025 FDD)
According to Bambu's 2025 Franchise Disclosure Document, a franchisee is obligated to pay all outstanding fees, inventory and supply purchases, and other charges owed to Bambu or its affiliates within 10 days of the termination or expiration date of the Franchise Agreement. This obligation extends to any agreement, whether written or oral, including subleases and lease assignments, between the franchisee and Bambu.
In the event that the termination is due to a default by the franchisee, the amounts owed to Bambu will also include an amount equal to the monthly Royalty Fees that would have been payable for each month from the date of termination until the expiration date that would have applied to the agreement had it not been terminated. This means that if a franchisee defaults and the agreement is terminated early, they may still be responsible for paying the royalty fees they would have paid had they continued operating the franchise for the full term.
This requirement ensures that Bambu receives all outstanding payments promptly after a franchise agreement ends, whether through expiration or termination. It also protects Bambu's financial interests in cases where a franchisee's default leads to early termination, ensuring they are compensated for the lost future royalty fees. Prospective franchisees should be aware of this obligation and factor it into their financial planning, especially considering the potential for accelerated royalty fee payments in the event of a default.