What responsibility does Buns On Fire Franchisor assume for the franchisee's securities offering?
Buns_On_Fire Franchise · 2025 FDDAnswer from 2025 FDD Document
"NEITHER SMYA VENTURES LLC NOR ANY OF ITS AFFILIATES ASSUMES ANY RESPONSIBILITY WITH RESPECT TO THIS OFFERING AND/OR THE ADEQUACY OR ACCURACY OF THE INFORMATION PRESENTED HEREIN, INCLUDING ANY STATEMENTS MADE WITH RESPECT TO ANY OF THEM. NEITHER SMYA VENTURES LLC NOR ANY OF ITS AFFILIATES ENDORSES OR MAKES ANY RECOMMENDATION WITH RESPECT TO THE INVESTMENT CONTEMPLATED BY THIS OFFERING."
(iii.) Franchisee and each of its owners agrees to indemnify, defend and hold harmless the Franchisor and its affiliates, and their respective officers, directors, employees and agents, from any and all claims, demands, liabilities, and all costs and expenses (including, without limitation, reasonable attorneys' fees) incurred in the defense of such claims, demands or liabilities, arising from the offer or sale of such securities, whether asserted by a purchaser of any such security or by a governmental agency. The Franchisor shall have the right (but not the obligation) to defend any such claims, demands or liabilities and/or to participate in the defense of any action to which the Franchisor or any of its affiliates or any of their respective officers, directors, employees or agents is named as a party.
Source: Item 23 — RECEIPTS (FDD pages 49–200)
What This Means (2025 FDD)
According to the 2025 Buns On Fire Franchise Disclosure Document, SMYA Ventures LLC, which is Buns On Fire, does not assume any responsibility for the franchisee's securities offering. This means Buns On Fire is not responsible for the accuracy or adequacy of the information presented in the offering, nor does it endorse or make any recommendations regarding the investment.
Furthermore, the franchisee is required to indemnify, defend, and hold harmless Buns On Fire and its affiliates from any claims, demands, liabilities, costs, and expenses arising from the offer or sale of securities. This includes reasonable attorney's fees incurred in defending against such claims. Buns On Fire has the right, but not the obligation, to defend any such claims or participate in the defense of any action.
This arrangement is typical in franchising, where franchisees sometimes seek to raise capital by selling securities in their individual franchise businesses. Franchisors like Buns On Fire want to avoid any liability related to these independent fundraising activities, so they explicitly disclaim responsibility and require franchisees to indemnify them against any related claims.