Is Checkersrallys required to furnish a New York prospectus, and if so, to whom?
Checkersrallys Franchise · 2025 FDDAnswer from 2025 FDD Document
Franchisor is required to furnish a New York prospectus to every prospective franchisee who is protected under the New York General Business Law, Article 33.
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- No disclaimer, questionnaire, clause, or statement signed by a franchisee in connection with the commencement of the franchise relationship shall be construed or interpreted as waiving any claim of fraud in the inducement, whether common law or statutory, or as disclaiming reliance on or the right to rely upon any statement made or information provided by any franchisor, broker or other person acting on behalf of the franchisor that was a material inducement to a franchisee's investment. This provision supersedes any other or inconsistent term of any document executed in connection with the franchise.
Source: Item 23 — RECEIPTS (FDD pages 92–384)
What This Means (2025 FDD)
According to Checkersrallys's 2025 Franchise Disclosure Document, Checkersrallys is required to furnish a New York prospectus to prospective franchisees who are protected under the New York General Business Law, Article 33. This protection applies if the offer or sale of the franchise is deemed to have occurred in New York.
An offer or sale is considered to be made in New York if the franchisee is domiciled in New York and the franchise will be opened in New York. This means that if a prospective Checkersrallys franchisee lives in New York and plans to open their franchise location in New York, Checkersrallys must provide them with a New York prospectus.
This requirement ensures that prospective franchisees in New York receive all the necessary information and protections mandated by New York law before entering into a franchise agreement with Checkersrallys. The prospectus would include details about the franchise opportunity, legal rights, and other disclosures required by Article 33 of the General Business Law of the State of New York.