What information must be disclosed to potential franchisees?

In Texas, prospective franchisees must be informed of various aspects of the franchising agreement and business operations. This information is required to be disclosed in accordance with state franchise laws, which are found in the Texas Business and Commerce Code. The following information must be disclosed to potential franchisees: 1. The contact information for the franchisor, including the name, address, and telephone number of all officers and managers. 2. The names and addresses of all known affiliate companies. 3. An outline of the franchisor’s experience in the franchising business. 4. An accurate balance sheet of the franchisor’s assets and liabilities. 5. An accurate account of how the franchisor spends franchise fees and other amounts paid by the franchisee. 6. An accurate description of the franchisor’s obligations to the franchisee, including the rights of the franchisee to terminate the franchising agreement and receive a refund. 7. A description of the products and services offered by the franchisor. 8. A list of all past and current franchisees. 9. A full disclosure of the franchisor’s strategies for advertising, promotion and other marketing efforts. 10. An accurate description of the rights and privileges of the franchisee, including exclusive territories. 11. An accurate list of all fees and other amounts payable by the franchisee. 12. An accurate description of the training, support, and other technical services to be provided by the franchisor to the franchisee. In addition, the franchisor must inform the franchisee of any material changes to the franchising agreement or operations during the term of the agreement. The franchisor must also provide the franchisee with copies of the Uniform Franchise Offering Circular, which outlines the rights and responsibilities of the franchisee and provides additional information.

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What information must be disclosed to potential franchisees?

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