Is the Bambu MUD Agreement a franchise agreement?

According to Bambu's 2025 Franchise Disclosure Document, the MUD (Multi-Unit Development) Agreement is explicitly not a franchise agreement. The document states that Bambu does not grant any franchise rights or similar rights to use their marks or system under the MUD Agreement. Furthermore, the franchisee does not have the right to license or subfranchise the Bambu system to others through the MUD Agreement. The MUD agreement solely grants the right to enter into subsequent Franchise Agreements, as detailed in Section 3.2.

This distinction is crucial for prospective franchisees because the MUD Agreement primarily outlines the development schedule and obligations for opening multiple Bambu locations. It secures the franchisee's right to expand within a specific area but does not grant the operational rights typically associated with a franchise. Franchisees must enter into separate Franchise Agreements for each individual location they plan to open under the MUD Agreement.

The MUD agreement ensures that Bambu franchisees commit to a development schedule, and it outlines the terms for opening multiple locations. However, the actual rights and responsibilities for operating each Bambu store are governed by the individual Franchise Agreements executed for each location. This two-tiered structure allows Bambu to manage its expansion while ensuring each store adheres to the brand's standards and operational guidelines.

Therefore, a prospective Bambu franchisee should understand that signing a MUD Agreement is a commitment to develop multiple units, but the actual franchise rights and operational details are contained within the separate Franchise Agreements that must be executed for each location. The MUD Agreement focuses on the development timeline and area, while the Franchise Agreement covers the day-to-day operations and brand usage.