Does the All States M.E.D. FDD place any geographic limits on the disclosure of former franchisee information?
All_States_M_E_D Franchise · 2024 FDDAnswer from 2024 FDD Document
EXHIBIT G-2 TO THE DISCLOSURE DOCUMENT LIST OF FORMER FRANCHISEES
The following is a list of the names, city and state, and current business telephone number, or if unknown, the last known home telephone number of every franchisee who had an outlet terminated, canceled, not renewed, or otherwise voluntarily or involuntarily ceased to do business under the franchise agreement during our most recently completed fiscal year or who have not communicated with us within 10 weeks of the Issuance Date of this Disclosure Document. If you buy this franchise, your contact information may be disclosed to other buyers when you leave the franchise system.
None.
EXHIBIT H TO THE DISCLOSURE DOCUMENT FRANCHISEE DISCLOSURE QUESTIONNAIRE
Not to be used as to any franchise sale in or to residents of CA, HI, IL, IN, MD, MI, MN, NY, ND, RI, SD, VA, WA, WI]
Source: Item 23 — RECEIPTS (FDD pages 44–174)
What This Means (2024 FDD)
According to All States M.E.D.'s 2024 Franchise Disclosure Document, Exhibit G-2 provides a list of former franchisees. This list includes the names, city and state, and current business telephone number, or if unknown, the last known home telephone number of every franchisee who had an outlet terminated, canceled, not renewed, or otherwise voluntarily or involuntarily ceased to do business under the franchise agreement during All States M.E.D.'s most recently completed fiscal year. It also includes franchisees who have not communicated with All States M.E.D. within 10 weeks of the Issuance Date of the Disclosure Document.
Notably, the Franchisee Disclosure Questionnaire, as detailed in Exhibit H, includes a restriction: it is "Not to be used as to any franchise sale in or to residents of CA, HI, IL, IN, MD, MI, MN, NY, ND, RI, SD, VA, WA, WI." This suggests that while All States M.E.D. aims to provide comprehensive information on former franchisees, the use of the Franchisee Disclosure Questionnaire, which could potentially involve contact with former franchisees, is limited in the listed states.
In practical terms, a prospective franchisee should be aware that while Exhibit G-2 provides contact information for former franchisees, the ability to use the Franchisee Disclosure Questionnaire to gather additional insights from former franchisees may be restricted if the franchise sale involves residents of California, Hawaii, Illinois, Indiana, Maryland, Michigan, Minnesota, New York, North Dakota, Rhode Island, South Dakota, Virginia, Washington, or Wisconsin. This limitation could impact the scope of due diligence a prospective franchisee can conduct in those specific states.