Under what conditions can the Bambu franchisor terminate the Franchise Agreement with cause?
Bambu Franchise · 2025 FDDAnswer from 2025 FDD Document
| Provision | Section in Franchise Agreement or Multi-Unit Development Agreement | Summary | |
|---|---|---|---|
| (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. |
| (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. |
This provision may not be enforceable under federal bankruptcy law.
Source: Item 17 — (FDD pages 44–46)
What This Means (2025 FDD)
According to Bambu's 2025 Franchise Disclosure Document, the franchisor can terminate the Franchise Agreement with cause if the franchisee commits certain violations, as detailed in Sections 19.1 and 19.2 of the Franchise Agreement and Sections 4.3 and 4.4 of the Multi-Unit Development Agreement. These violations are categorized into curable and non-curable defaults.
Curable defaults include misuse of the Marks, purchases from unapproved suppliers, or other failures to comply with FRC Materials or other standards, which require a 48-hour notice to cure. Monetary defaults require a 5-day notice, while filing a legal action violating the dispute resolution terms requires a 7-day notice. Other defaults generally allow for a 30-day cure period. It is important to note that Bambu and its affiliates may suspend services to the franchisee until each default is resolved after providing a notice of default.
Non-curable defaults, which allow for immediate termination, include unauthorized disclosure, conviction of a crime, abandonment, failure to have Bambu Certified Team Leaders present or available at the shoppe for three consecutive days, unapproved transfers, bankruptcy, assignment for the benefit of creditors, unsatisfied judgments, levy, foreclosure, repeated violations, violating restrictive covenants, issuing two insufficient funds checks, health and safety violations, misrepresentations, sexual harassment or discrimination, breach of other agreements between Bambu or its affiliates and the franchisee or their affiliates, if a guaranty becomes unenforceable or inadequate, or if the franchisee becomes subject to the PATRIOT Act. Note that the provision regarding bankruptcy may not be enforceable under federal bankruptcy law.
These termination conditions are standard in franchise agreements to protect the brand and maintain consistency across all franchise locations. Prospective Bambu franchisees should carefully review Sections 19.1 and 19.2 of the Franchise Agreement to fully understand the specific actions that could lead to termination and the required cure periods, as well as understand their obligations upon termination, which include paying outstanding amounts and de-identifying the shoppe.