In Maryland, when are the initial fees and payments owed by 1-800-GOT-JUNK? franchisees due?
1_800_Got_Junk Franchise · 2025 FDDAnswer from 2025 FDD Document
MARYLAND
ADDENDUM TO THE FRANCHISE DISCLOSURE DOCUMENT, FRANCHISE AGREEMENT, FRANCHISE DISCLOSURE QUESTIONNAIRE AND CERTIFICATION, AND RELATED AGREEMENTS
This Addenda is an amendment to the Disclosure Document and Franchise Agreement.
The following modifications are made to the Disclosure Document and the Franchise Agreement:
Based upon the franchisor’s financial condition, the Maryland Securities Commissioner has required a financial assurance. Therefore, all initial fees and payments owed by franchisees shall be deferred until the franchisor completes its pre-opening obligations under the Franchise Agreement and the outlet is opened. Items 5 and 7 of the Disclosure Document and Section 3.1 and Schedule B of the Franchise Agreement are amended accordingly.
Source: Item 22 — Contracts (FDD page 24)
What This Means (2025 FDD)
According to the 2025 Franchise Disclosure Document, the Maryland Securities Commissioner requires a financial assurance due to 1-800-GOT-JUNK?'s financial condition. As a result, in Maryland, all initial fees and payments owed by 1-800-GOT-JUNK? franchisees are deferred. These fees and payments are not due until 1-800-GOT-JUNK? completes its pre-opening obligations under the Franchise Agreement and the outlet is opened. This amendment affects Items 5 and 7 of the Disclosure Document, as well as Section 3.1 and Schedule B of the Franchise Agreement.
This deferral of initial fees and payments provides a significant benefit to prospective 1-800-GOT-JUNK? franchisees in Maryland. It reduces the upfront financial burden and risk, as franchisees do not have to pay these fees until 1-800-GOT-JUNK? has fulfilled its obligations to prepare the outlet for opening. This can be particularly helpful for franchisees who are financing their investment or who want to conserve capital during the initial setup phase.
It's important for prospective franchisees in Maryland to carefully review the Maryland Addendum to the Franchise Disclosure Document and Franchise Agreement to fully understand the terms and conditions of this deferral. They should also consult with legal and financial advisors to assess the implications of this provision for their specific circumstances. This addendum specifically modifies certain sections of the standard franchise agreement to comply with Maryland law.