What does the Alloy surety bond filed with the Maryland Securities Division cover?

According to Alloy's 2025 Franchise Disclosure Document, due to the franchisor's financial condition, the Maryland Securities Commissioner requires financial assurance in the form of a surety bond filed with the Maryland Securities Division. This bond specifically covers the initial franchise fee for a single-unit franchise or an area development franchise for three units. Alloy states that these are the only types of franchises they are currently offering and selling in Maryland. Alloy also confirms they will not offer or sell any other area development franchises in Maryland.

This means that if Alloy fails to meet its obligations to a franchisee in Maryland related to the initial franchise fee, the franchisee may be able to make a claim against the surety bond to recover the initial franchise fee paid. The surety bond provides a level of financial protection to franchisees in Maryland due to Alloy's current financial condition.

Prospective franchisees should carefully review the terms of the surety bond and understand the specific conditions under which a claim can be made. It is also advisable to consult with a legal professional to fully understand their rights and protections under the Maryland Franchise Registration and Disclosure Law.