Can a Marble Slab Creamery franchisee offer shares for sale through a public offering of securities?
Marble_Slab_Creamery Franchise · 2025 FDDAnswer from 2025 FDD Document
d, however*, that Franchisor may, in its sole discretion, condition its approval of the transaction and proposed transferee on the proposed transferee attending training prior to closing, in which event Franchisee must pay the transfer fee prior to commencement of such training and each trainee must execute a confidentiality agreement in form prescribed by Franchisor.
12.2.4 Franchisee acknowledges and agrees that each condition which must be met by the transferee is necessary to assure such transferee's full performance of the obligations hereunder.
12.3 Offerings by Franchisee:
Securities, partnership or other ownership interests in Franchisee may not be offered to the public under the Securities Act of 1933, as amended, nor may they be registered under the Securities Exchange Act of 1934, as amended, or any comparable federal, state or foreign law, rule or regulation. Securities or partnership interests in Franchisee may be sold, by private offering or otherwise, only pursuant to the requirements of Section 12.2. All materials required for such offering by federal or state law will be submitted to Franchisor for limited review before their being filed with any Governmental Authority; and any materials to be used in any exempt offering will be submitted to Franchisor for limited review before their use. No Franchisee offering will imply (by use of the Proprietary Marks or otherwise) that Franchisor is participating as an underwriter, issuer, or offeror of Franchisee's or Franchisor's securities; and Franchisor's limited review of any offering will be limited solely to the subject of the relationship between Franchisee and Franchisor. Franchisee and the other participants in the offering must fully indemnify Franchisor in connection with the offering. For each proposed offering,
Source: Item 22 — CONTRACTS (FDD page 101)
What This Means (2025 FDD)
According to Marble Slab Creamery's 2025 Franchise Disclosure Document, franchisees are restricted from offering securities to the public. Specifically, securities, partnership, or other ownership interests in a Marble Slab Creamery franchise cannot be offered to the public under the Securities Act of 1933 or registered under the Securities Exchange Act of 1934, or any similar federal, state, or foreign law.
However, the FDD does state that private offerings or sales of securities or partnership interests are permitted, but only if they adhere to the requirements outlined in Section 12.2 of the franchise agreement. Before filing any materials with a Governmental Authority, franchisees must submit all materials required for such offering by federal or state law to Marble Slab Creamery for a limited review. Additionally, any materials intended for use in an exempt offering must also be submitted to Marble Slab Creamery for review before use.
Marble Slab Creamery stipulates that no franchisee offering can imply that Marble Slab Creamery is participating as an underwriter, issuer, or offeror of securities. The franchisor's review is limited to the relationship between the franchisee and Marble Slab Creamery. The franchisee must also indemnify Marble Slab Creamery in connection with the offering. For each proposed offering, the franchisee must pay Marble Slab Creamery a non-refundable fee of $10,000, or a greater amount if necessary to cover the franchisor's reasonable costs and expenses for reviewing the offering. Franchisees are required to provide written notice to Marble Slab Creamery at least 30 days before starting any offering or transaction covered by this section.