Is Bambu's written consent required for a franchisee to transfer their franchise rights?

• 17.1 Transfer by Franchisee.

The franchise granted herein is personal to Franchisee and, except as stated below, Franchisee shall not transfer, assign, sub-franchise or convey this Agreement or any interest hereunder nor purport to do so without Bambu's prior written consent which consent will not be unreasonably withheld.

Franchisee acknowledges that prior to approving any transfer, Bambu may impose reasonable conditions on Franchisee and its purported transferee in addition to those conditions listed in Section 17.2.

As used in this Agreement, the term "transfer" shall mean and include the voluntary, involuntary, direct or indirect assignment, sale, gift or other disposition by Franchisee (or any of its owners) of any interest in: (1) this Agreement; (2) the ownership of Franchisee; or (3) the shoppe or any assets of the shoppe.

The term "transfer" shall also mean and include any change in Franchisee resulting from a divorce, insolvency, corporate or partnership dissolution proceeding, merger, change of control, those transfers described in Section 17.5, by operation of law or, in the event of the death of Franchisee, or an owner of Franchisee by will, declaration of or transfer in trust or under the laws of intestate succession.

• 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.

• b.

Agreement by the proposed transferee to satisfactorily complete the Training Program described in this Agreement, which training may be completed by the transferee either prior to or immediately after assignment of this Agreement.

• c.

Execution of a Franchise Agreement (for the same type of franchise as granted by this Agreement or an equivalent type then offered as determined by Bambu) and any ancillary documents, such as the Guaranty and Assumption of Franchisee's Obligations and Nondisclosure and Noncompetition Agreement, in a form then currently offered and required by Bambu, which shall supersede this Agreement in all respects.

If a new Franchise Agreement is signed, the terms thereof may differ substantially from the terms of this Agreement; provided, however, the transferee will not be required to pay any additional initial franchise fee.

• d.

Provision by Franchisee of written notice to Bambu 30 days prior to the proposed effective date of the transfer, such notice to contain information reasonably detailed to enable Bambu to evaluate the terms and conditions of the proposed transfer, an which at a minimum includes a written offer from the proposed transferee.

• e.

The proposed transferee shall have provided information to Bambu sufficient for Bambu to assess the proposed transferee's business experience, aptitude and financial qualification, and Bambu shall have ascertained that the proposed transferee meets such qualifications.

• f.

Execution by Franchisee of a general release, in a form satisfactory to Bambu, of any and all claims against Bambu, its affiliates and their respective officers, directors, members, managers, employees and agents.

• g.

Payment by Franchisee or the proposed transferee of a transfer fee ("Transfer Fee") in the amount set forth in Attachment I.

The Transfer Fee covers the training for up to three representatives of transferee.

Bambu reserves the right to charge Franchisee its then current rate for training any additional representatives of transferee.

The Transfer Fee is payable when Franchisee presents the written offer from the proposed transferee to Bambu.

• h.

Agreement by Franchisee to abide by the post-termination covenant not to compete set forth in Section 21.2 below.

• i.

If so requested by Bambu, Franchisee, at its expense, shall upgrade the shoppe to conform to the then current standards and specifications of new shoppes then-being established pursuant to the Bambū system, and shall complete upgrading and other requirements within the time specified by Bambu.

• j.

The transferor shall remain liable for all of the obligations to Bambu in connection with the shoppe that arose prior to the effective date of the transfer, and any covenants that survive the termination or expiration of this Agreement, and shall execute any and all instruments reasonably requested by Bambu to evidence such liability.

• 17.3 Bambu's Approval of Transfer.

Bambu has 30 days from the date of the written notice of the proposed transfer to approve or disapprove in writing of Franchisee's proposed transfer.

Franchisee acknowledges that the proposed transferee shall be evaluated for approval by Bambu based on the same criteria as is then currently being used to assess new franchisees of Bambu and that such proposed transferee shall be provided, if appropriate, with such pre-transfer disclosures as may be required by state or federal law.

Bambu's consent to one transfer shall not constitute consent or approval to any subsequent transfer.

• 17.4 Right of First Refusal.

Franchisee grants to Bambu a 30-day right of first refusal to purchase such rights, interest or assets on the same terms and conditions as are contained in the written notice set forth in Section 17.2.d; provided, however, the following additional terms and conditions shall apply:

• a. the right of first refusal will be effective for each proposed transfer and any material change in the terms or conditions of the proposed transfer shall be deemed a separate offer on which Bambu shall have a new 30-day right of first refusal;

• b. the 30-day right of first refusal period will run concurrently with the period in which Bambu has to approve or disapprove the proposed transferee; and

• c. if the consideration or manner of payment offered by a proposed transferee is such that Bambu may not reasonably be required to furnish the same, then Bambu may purchase the interest which is proposed to be sold for the reasonable cash equivalent.

Source: Item 23 — Receipts (FDD pages 52–209)