Under what conditions can Bambu terminate the franchise agreement effective immediately upon notice?
Bambu Franchise · 2025 FDDAnswer from 2025 FDD Document
ranchisee shall comply with the provisions of Section 19.4 below.
19. DEFAULT AND TERMINATION
- 19.1 Termination by Bambu Effective Upon Notice. Bambu shall have the right, at its option, to terminate this Agreement and all rights granted Franchisee hereunder, without affording Franchisee any opportunity to cure any default (except where expressly indicated and subject to any state laws to the contrary, where state law shall prevail), effective upon notice to Franchisee upon the occurrence of any of the following events:
- a. Abandonment. If Franchisee ceases to operate the Bambū shoppe or otherwise abandons the Bambū shoppe for a period of three consecutive days, or any shorter period that indicates an intent by Franchisee to discontinue operation of the Bambū shoppe. Franchisee's suspension or termination of the shoppe's operation due to fire, flood, earthquake, epidemic or pandemic, or force majeure shall not be deemed abandonment.
- b. No Bambū Certified Team Leaders Present. No Bambū Certified Team Leaders are present at, or are available upon Bambu's demand to be present at, the Bambū shoppe for three consecutive days.
- c. Insolvency; Assignments. If Franchisee becomes insolvent or is adjudicated a bankrupt; or if any action is taken by Franchisee, or by others against Franchisee under any insolvency, bankruptcy or reorganization act, (this provision may not be enforceable under federal bankruptcy law, 11 U.S.C. §§ 101 et seq.); or if Franchisee makes an assignment for the benefit of creditors or a receiver is appointed by Franchisee.
- d. Unsatisfied Judgments; Levy; Foreclosure. If any material judgment (or several judgments which in the aggregate are material) is obtained against Franchisee and remains unsatisfied or of record for 30 days or longer (unless a supersedeas or other appeal bond has been filed); or if execution is levied against Franchisee's business or any of the property used in the operation of the Bambū shoppe and is not discharged within five days; or if the real or personal property of Franchisee's business shall be sold after levy thereupon by any sheriff, marshal or constable.
- e. Criminal Conviction.
Source: Item 23 — Receipts (FDD pages 52–209)
What This Means (2025 FDD)
According to Bambu's 2025 Franchise Disclosure Document, Bambu can terminate the franchise agreement immediately upon notice, without allowing an opportunity to cure the default (except where expressly indicated and subject to any state laws to the contrary, where state law shall prevail), under certain conditions. These conditions include abandonment of the Bambu shop for three consecutive days or any shorter period indicating an intent to discontinue operations, unless due to events like fire, flood, earthquake, epidemic/pandemic, or force majeure.
Another cause for immediate termination is the absence of Bambu Certified Team Leaders at the shop or their unavailability to be present upon Bambu's demand for three consecutive days. Bambu can also terminate immediately if the franchisee becomes insolvent or makes assignments that violate the agreement.
Additional reasons for immediate termination include violations of laws or regulations, criminal convictions impacting the brand, endangering customers or employees, transferring the franchise without approval, misrepresenting information to Bambu, compromising the brand's integrity, or failing to meet safety and health standards. Other causes include loss of the location, unauthorized alteration of products or services, improper use of trademarks, violating confidentiality, or failing to address issues related to terrorism or security laws. Finally, Bambu can terminate immediately if the franchisee breaches any other agreement with Bambu without curing the breach, if any guaranty of the agreement fails or is inadequate, or if the franchisee files a non-compliant legal action against Bambu and fails to dismiss it within seven days of notification.
These terms mean a Bambu franchisee must maintain continuous operation, ensure certified team leaders are always available, and avoid financial instability or legal missteps. Failure to comply with these stipulations could lead to immediate termination of the franchise agreement, highlighting the importance of strict adherence to the outlined operational and legal standards to protect the franchisee's investment and business operations.