Must all outstanding payments to Bambu be settled before a franchise transfer can occur?
Bambu Franchise · 2025 FDDAnswer from 2025 FDD Document
- 17.2 Pre-Conditions to Franchisee's Transfer.
Franchisee shall not transfer its rights under this Agreement or any interest in it, or any part or portion of any business entity that owns it or all or a substantial portion of the assets of the Bambū shoppe, unless: (1) the shoppe has already opened for business and has been operating for at least 30 days; and (2) Franchisee obtains Bambu's written consent and complies with all of the following requirements:
- a.
Payment of all amounts due and owing pursuant to this Agreement by Franchisee to Bambu or its affiliates or to third parties holding a security interest in any asset of the franchised business and Franchisee is otherwise in full compliance with this Agreement.
Source: Item 23 — Receipts (FDD pages 52–209)
What This Means (2025 FDD)
According to Bambu's 2025 Franchise Disclosure Document, a franchisee must settle all outstanding payments before transferring their franchise. Specifically, the franchisee must have paid all amounts due to Bambu, its affiliates, or third parties holding a security interest in the franchised business assets. Additionally, the franchisee must be in full compliance with all other aspects of the Franchise Agreement.
This requirement ensures that Bambu does not have to deal with outstanding financial obligations from the transferring franchisee after the transfer is complete. It protects Bambu's financial interests and maintains the integrity of the franchise system. For a prospective franchisee looking to eventually sell their Bambu location, it is crucial to maintain good financial standing and adhere to the terms of the Franchise Agreement to facilitate a smooth transfer process.
Furthermore, the proposed transferee must also meet certain qualifications, including completing the required training program. They must also execute a new Franchise Agreement and related documents. The franchisee must provide Bambu with 30 days' written notice prior to the proposed transfer date, including detailed information about the transfer terms and the proposed transferee. These conditions collectively ensure that any transfer maintains the standards and financial health of the Bambu franchise system.