Under what conditions can the Bambu Franchise Agreement be modified, and what is the requirement for a general release of claims?
Bambu Franchise · 2025 FDDAnswer from 2025 FDD Document
| Provision | Section in Franchise Agreement or Multi-Unit Development Agreement | Summary | |
|---|---|---|---|
| (p) | Death or disability of franchisee | Section 17.7 of FA | Franchise must be assigned to approved buyer within 180 days. |
| (q) | Non-competition covenants during the term of the franchise | Section 21.1 of FA; Section 6.1 of MUDA | No involvement in competing business and no diversion of customers or employees. |
| (r) | Non-competition covenants after the franchise is terminated or expires | Section 21.2 of FA; Section 6.1 of MUDA | No competing business for 2 years within 10 miles of your shoppe or any other Bambū shoppe. |
| (s) | Modification of the agreement | Section 24.1 of FA; Section 8.5 of MUDA | The FRC Materials are subject to change. The Franchise Agreement may be modified by a writing signed by both parties or, at our option, upon approval of 75% of our franchisees affected by the modification. Unless prohibited by law or waived by us, you must provide a general release of all claims against us if you request and we consent to modify any provisions of the Franchise Agreement after it has been signed. The MUD Agreement may be modified only by a writing signed by both parties. |
Source: Item 17 — (FDD pages 44–46)
What This Means (2025 FDD)
According to Bambu's 2025 Franchise Disclosure Document, the Franchise Agreement can be modified under specific conditions. The agreement may be modified by a written document signed by both Bambu and the franchisee. Alternatively, Bambu has the option to modify the agreement upon approval of 75% of the franchisees affected by the modification.
If a franchisee requests a modification to any provision of the Franchise Agreement after it has been signed, they must provide a general release of all claims against Bambu. This requirement can be waived by Bambu, or it may be prohibited by law. This release is a significant point for prospective franchisees, as it means giving up any potential legal claims against Bambu as a condition of getting the Franchise Agreement modified.
This requirement for a general release is not uncommon in franchising when modifications are requested by the franchisee. It protects the franchisor from potential future claims arising from the original agreement. Franchisees should carefully consider the implications of such a release and seek legal counsel before agreeing to it. The Multi-Unit Development Agreement, however, can only be modified by a writing signed by both parties.