Is there a specific article that describes the Restrictive Covenants that Bambu franchisees must adhere to?
Bambu Franchise · 2025 FDDAnswer from 2025 FDD Document
6. RESTRICTIVE COVENANTS
6.1. Restrictive Covenants. During the term and after the termination of this MUD Agreement or any Franchise Agreement signed in furtherance of this MUD Agreement, Franchisee and its Approved Affiliates and their officers, partners, directors, managers, agents or employees who have completed Bambu's training programs or had access to the Resource Center Materials, as described in the Franchise Agreement, or the beneficial owners of a five percent or greater interest in Franchisee or an Approved Affiliate and their respective immediate families, shall be subject to all restrictive covenants as set forth in the Franchise Agreement executed concurrently herewith, and in any nondisclosure and noncompetition agreements executed by Franchisee, its Approved Affiliates, or their employees, owners, managers, members, partners, officers, directors, agents or representatives, which covenants by this reference are incorporated herein.
Source: Item 23 — Receipts (FDD pages 52–209)
What This Means (2025 FDD)
According to Bambu's 2025 Franchise Disclosure Document, Article 6.1 addresses the restrictive covenants. This section states that the franchisee, their approved affiliates, and individuals associated with them (such as officers, partners, directors, managers, agents, or employees who have completed Bambu's training or accessed resource center materials) are subject to the restrictive covenants outlined in the Franchise Agreement. This also applies to beneficial owners with a five percent or greater interest in the franchise or an approved affiliate, as well as their immediate families.
The restrictive covenants are detailed within the Franchise Agreement executed concurrently with the MUD (Multi-Unit Development) Agreement. Additionally, any nondisclosure and noncompetition agreements signed by the franchisee, their affiliates, or their representatives are incorporated by reference. This means that franchisees and related parties are legally bound by the terms of these covenants, which likely restrict certain activities during and after the franchise term to protect Bambu's business interests.
These restrictions are designed to prevent franchisees from using Bambu's confidential information or competing unfairly with the franchisor, especially after the franchise agreement ends. Prospective franchisees should carefully review Article 6.1 and the referenced sections in the Franchise Agreement, as well as any non-disclosure or non-competition agreements, to fully understand the scope and implications of these restrictive covenants. Understanding these obligations is crucial for assessing the long-term impact on their business activities and future opportunities.