After termination of the Bambu MUD agreement, does the Franchisee remain subject to the non-disclosure and non-compete agreements?
Bambu Franchise · 2025 FDDAnswer from 2025 FDD Document
s MUD Agreement and all other agreements between Bambu and Franchisee or any of Franchisee's affiliates may, at Bambu's sole option, be terminated.
- 4.5. Post-Termination Obligations. In the event of termination or expiration of this MUD Agreement for any reason, Franchisee shall not be entitled to any refund of any portion of the fees paid hereunder. Franchisee shall remain subject to the provisions of Article 6 of this MUD Agreement regarding nondisclosure and covenants not to compete, in addition to the terms and conditions of any and all Franchise Agreements executed in furtherance of this MUD Agreement which have not also been terminated or expired. No right or remedy herein conferred upon or reserved by Bambu is exclusive of any other right or remedy provided or permitted by law or equity.
5. ASSIGNMENT
- 5.1. Assignment by Bambu. Bambu may transfer or assign its rights under this MUD Agreement at any time upon notice to Franchisee, provided that Bambu has fulfilled its obligations hereunder or has made adequate provisions therefor.
- 5.2. Assignment by Franchisee. Because the rights granted herein are personal to Franchisee, Franchisee shall not transfer, assign or convey this MUD Agreement or any interest hereunder without Bambu's prior written consent which consent shall not be unreasonably withheld if Franchisee complies with the transfer provisions of the Franchise Agreement most recently executed by Bambu and Franchisee, which provisions shall be deemed to be incorporated herein by reference. Bambu reserves the right to require the transferee to sign the then-current form of MUD Agreement with materially different terms and conditions that may be negotiated between the parties depending on the circumstances of the transfer.
Source: Item 23 — Receipts (FDD pages 52–209)
What This Means (2025 FDD)
According to Bambu's 2025 Franchise Disclosure Document, if the MUD (Multi-Unit Development) Agreement is terminated or expires for any reason, the franchisee remains subject to the non-disclosure and non-compete provisions outlined in Article 6 of the MUD Agreement. This obligation is in addition to the terms and conditions of any and all Franchise Agreements executed to further the MUD Agreement that have not also been terminated or expired.
This means that even after the MUD Agreement ends, a franchisee must continue to protect Bambu's confidential information and adhere to the non-compete restrictions. These restrictions likely prevent the franchisee from engaging in similar businesses or activities that would compete with Bambu, safeguarding Bambu's market position and trade secrets.
The restrictive covenants extend not only to the franchisee but also to their Approved Affiliates, officers, partners, directors, managers, agents, or employees who have completed Bambu's training programs or had access to the Resource Center Materials. It also includes the beneficial owners of a five percent or greater interest in Franchisee or an Approved Affiliate and their respective immediate families. This comprehensive coverage ensures that a wide range of individuals connected to the franchisee are bound by these obligations.
This continued obligation is a significant consideration for potential franchisees, as it limits their future business activities even after the MUD Agreement concludes. Franchisees should carefully review Article 6 of the MUD Agreement and the corresponding sections of the Franchise Agreement to fully understand the scope and duration of these restrictions.