This form requests certain information with regard to each corporate officer, director, partner, or other principal of the franchise sales agent. The form also contains a supplemental franchise sales agent statement which is to be used when reporting a change of corporate officers, directors, or other principals of the franchise sales agent.
Maryland New York Franchise Sales Agent Statement
Category:
State:
Multi-State
Control #:
US-4-16-2-STP
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Word;
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FAQ
The FDD outlines comprehensive information about the roles of both parties involved in the franchise?the franchisor and the franchisee?and is designed to enable the potential franchisee to make an honest and informed decision about their investment into the business.
FTC Item 19 Earnings Claim The FTC's Franchise Rule permits a franchisor to provide information about the actual or potential financial performance of its franchised and/or franchisor-owned outlets, if there is a reasonable basis for the information, and if the information is included in the disclosure document.
Franchise sales agent means a person who directly or indirectly engages in the offer or sale of any franchise on behalf of another. Franchisors, subfranchisors, and their employees are not to be considered franchise sales agents.
FDD Item 19 is the section of the Franchise Disclosure Document where franchisors must disclose their financial performance representations. If a franchisor elects to make a financial performance representation, it must be fully disclosed in Item 19 and must comply with federal and state franchise laws.
Any representation, including any oral, written, or visual representation, to a prospective franchisee, including a representation in the general media, that states, expressly or by implication, a specific level or range of actual or potential sales, income, gross profits, or net profits.
A Franchise Disclosure Document includes 23 specific pieces of information (called items), the franchisors franchise agreement, and various exhibits (like a list of current and past franchisees, and audit financials of the franchisor.
How is a Franchise Disclosure Document Structured? Item 1: The Franchisor, and any Parents, Predecessors, and Affiliates. Item 2: Business Experience. Item 3: Litigation. Item 4: Bankruptcy. Item 5: Initial Fees. Item 6: Other Fees. Item 7: Estimated Initial Investment. Item 8: Restrictions on Sources of Products and Services.