To whom does the Red Wagon Club licensee provide financial statements and statistical reports?

According to the 2024 Red Wagon Club FDD, a licensee must provide periodic financial statements, statistical reports, and other information regarding their law firm business upon request. The licensee provides this information to the Licensor. The Licensor, at the request of Red Wagon Club, will then provide these records and reports to Red Wagon Club, provided that Red Wagon Club agrees to keep such records and reports confidential.

This means that as a Red Wagon Club licensee, you are obligated to furnish financial and statistical data about your law firm to the Licensor whenever they request it. This information ultimately goes to Red Wagon Club, but with a promise of confidentiality. This allows Red Wagon Club to monitor the performance and compliance of its licensees.

Franchisors typically require franchisees to submit regular financial reports to assess the financial health of the franchise and ensure compliance with the franchise agreement. The confidentiality clause mentioned suggests that Red Wagon Club recognizes the sensitivity of this information and aims to protect it. A prospective franchisee should confirm what specific financial and statistical reports are required and how frequently they must be submitted.