Does a Bambu franchisee have a right of first refusal to acquire additional Bambu franchises?

According to Bambu's 2025 Franchise Disclosure Document, franchisees generally do not have a right of first refusal to acquire additional Bambu franchises. The FDD states that unless a franchisee signs a MUD (Multi-Unit Development) Agreement, they have no option, right of first refusal, or similar contractual right to acquire additional Bambu franchises. However, Bambu reserves the right to offer an existing franchisee the first right to purchase an additional franchise in the market area adjacent to their existing Franchised Location. This means that while there's no guaranteed right, Bambu may, at its discretion, give an existing franchisee the first opportunity to expand in their vicinity.

For franchisees who do sign a MUD Agreement, the agreement grants the right to establish a set number of Bambu shoppes within a larger geographical territory (Development Area) according to an agreed-upon schedule. However, even with a MUD Agreement, franchisees do not have a right of first refusal to acquire additional Bambu franchises in contiguous areas. Bambu retains the right to operate Bambu shoppes or grant successor franchise rights related to existing franchise agreements within the Development Area. The continuation of rights to the Development Area depends on meeting the Development Schedule, which requires opening and continuously operating a certain number of Bambu shoppes by specific deadlines. Failure to meet this schedule may result in the termination of development rights.

There is an exception regarding Drive-thru shoppes. If Bambu desires to open or permit someone else to open a Drive-thru shoppe in a franchisee's Protected Area or Development Area, Bambu will give the franchisee a right of first refusal to participate in the Drive-thru shoppe with either partial or whole ownership. This specific right of first refusal is limited to Drive-thru shoppes within the franchisee's territory.

Bambu also retains the right to use and license others to use the Bambu system to establish shoppes at Institutional Facilities, such as those in airports, amusement parks, or hospitals, even within a franchisee's Protected Area or Development Area. Additionally, Bambu can operate or grant a third party the right to operate any Bambu shoppe acquired as a result of exercising a right of first refusal or purchase right that Bambu may have been granted at any location. These stipulations highlight that while some territorial protection exists, Bambu retains considerable flexibility in expanding its brand through various channels and locations, including offering existing franchisees the first chance at adjacent market areas or Drive-thru locations within their territory.