What is the purpose of the Franchisee Disclosure Acknowledgment Statement for a Nothing Bundt Cakes franchise?
Nothing_Bundt_Cakes Franchise · 2025 FDDAnswer from 2025 FDD Document
THIS ACKNOWLEDGEMENT SHALL NOT BE COMPLETED BY YOU, AND WILL NOT APPLY, IF THE OFFER OR SALE OF THE FRANCHISE IS SUBJECT TO THE STATE FRANCHISE DISCLOSURE LAWS IN THE STATES OF CALIFORNIA, HAWAII, ILLINOIS, INDIANA, MARYLAND, MICHIGAN, MINNESOTA, NEW YORK, NORTH DAKOTA, RHODE ISLAND, SOUTH DAKOTA, VIRGINIA, WASHINGTON, OR WISCONSIN.
THIS ACKNOWLEDGEMENT SHALL NOT BE COMPLETED BY YOU, AND WILL NOT APPLY, IF THE FRANCHISE IS TO BE OPERATED IN, OR IF YOU ARE A RESIDENT OF, CALIFORNIA OR MARYLAND.
As you know, NBC Franchisor LLC (the "Franchisor") and you are preparing to enter into a Franchise Agreement for the establishment and operation of a "Nothing Bundt Cakes" Bakery. The purpose of this Questionnaire is to determine whether any statements or promises were made to you by employees or authorized representatives of Franchisor, or by employees or authorized representatives of a broker acting on behalf of the Franchisor ("Broker"), that have not been authorized, or that were not disclosed in the Disclosure Document or that may be untrue, inaccurate or misleading. The Franchisor, through the use of this document, desires to ascertain (a) that the undersigned, individually and as a representative of any legal entity established to acquire the franchise rights, fully understands and comprehends that the purchase of a franchise is a business decision, complete with its associated risks, and (b) that you are not relying upon any oral statement, representations, promises or assurances during the negotiations for the purchase of the franchise which have not been authorized by Franchisor.
In the event that you are intending to purchase an existing "Nothing Bundt Cakes" Bakery from an existing Franchisee, you may have received information from the transferring Franchisee, who are not employees or representatives of Franchisor. The questions below do not apply to any communications that you had with the transferring Franchisee. Please review each of the following questions and statements carefully and provide honest and complete responses to each.
Source: Item 23 — RECEIPTS (FDD pages 93–309)
What This Means (2025 FDD)
According to the 2025 Nothing Bundt Cakes Franchise Disclosure Document, the Franchisee Disclosure Acknowledgment Statement is used by NBC Franchisor LLC to confirm that prospective franchisees understand the nature of their investment. The statement aims to verify that franchisees recognize that purchasing a franchise is a business decision carrying inherent risks. It also ensures that franchisees acknowledge they are not relying on any unauthorized oral statements, representations, promises, or assurances made during negotiations that were not explicitly authorized by Nothing Bundt Cakes.
This acknowledgment is crucial for Nothing Bundt Cakes to protect itself from potential future disputes. By having franchisees confirm in writing that they understand the risks and have not relied on unauthorized information, the franchisor aims to mitigate legal challenges based on misrepresentation or unfulfilled promises. This is a standard practice in franchising, as it provides a documented understanding between both parties regarding the terms and conditions of the franchise agreement.
However, the Franchisee Disclosure Acknowledgment Statement does not apply to franchisees in certain states with specific franchise disclosure laws, including California, Hawaii, Illinois, Indiana, Maryland, Michigan, Minnesota, New York, North Dakota, Rhode Island, South Dakota, Virginia, Washington, or Wisconsin. Additionally, it does not apply if the franchise is to be operated in, or if the franchisee is a resident of, California or Maryland. This implies that Nothing Bundt Cakes adheres to the specific franchise regulations and requirements of these states, which may have different or more stringent disclosure requirements.
Furthermore, if a prospective franchisee is purchasing an existing Nothing Bundt Cakes bakery from a transferring franchisee, the acknowledgment statement does not apply to any communications with the transferring franchisee, as they are not employees or representatives of the franchisor. This distinction is important because the franchisor only wants to validate information provided by its own authorized representatives, ensuring consistency and accuracy in the information provided to new franchisees.