Where is the Hyper Kidz Surety Bond on file in Maryland?
Hyper_Kidz Franchise · 2024 FDDAnswer from 2024 FDD Document
- Section 25.2 and Attachment 1 FRANCHISEE ACKNOWLEDGEMENT STATEMENT to the Franchise Agreement and section 21 of the Multi-Unit Development Agreement are removed.
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- Item 5 of the Disclosure Document, Article 10 of the Franchise Agreement, and Section 2 of the Multi-Unit Development Agreement are amended to state, "In the State of Maryland, we have secured a Surety Bond in the amount of $141,000 from The Ohio Casualty Insurance Company. This Surety Bond requirement has been im
Source: Item 20 — OUTLETS AND FRANCHISEE INFORMATION (FDD pages 49–52)
What This Means (2024 FDD)
According to the 2024 Hyper Kidz Franchise Disclosure Document, if a franchisee is operating in Maryland, Hyper Kidz has secured a $141,000 surety bond from The Ohio Casualty Insurance Company. This bond is a requirement imposed by the Office of the Attorney General of the State of Maryland due to Hyper Kidz's financial condition.
The surety bond is filed with the Maryland Securities Division. This means that prospective franchisees can verify the existence and terms of the bond with the Maryland Securities Division.
Surety bonds are often required by state franchise laws to protect franchisees. If Hyper Kidz fails to meet its financial or contractual obligations to a franchisee in Maryland, the franchisee can make a claim against the bond to recover losses. The fact that a surety bond is required due to Hyper Kidz's financial condition suggests that prospective franchisees should carefully review Hyper Kidz's financial statements and consider seeking professional financial advice before investing in the franchise.