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Ryan Palmer’s Answers

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  • Franchise Agreement 10 day cooling period 5 day

    If we have a existing franchisee taking on a new franchise location and there have been no changes to our UFDD since their last signed agreement how long must they have the agreement in hand before they can legally accept the agreement?

    Ryan’s Answer

    You should comply with the FTC Rule on Franchising and any applicable state laws and regulations. Your Franchise Disclosure Document must be compliant with the FTC Rule and in certain jurisdictions must be registered with state offices. In addition, the FTC Rule requires that you provide the franchisee with a copy of the current Franchise Disclosure Document at least 14 calendar days before the prospective franchisee signs a binding agreement with you or makes any payments to the franchisor. You must also provide the prospective franchisee with a copy of all contracts to be signed, with all material blanks completed, at least seven calendar days before the franchisee signs the agreement. The seven-day period can run concurrently with the 14-day period.

    This response does not constitute legal advice; it is intended as general information that is not to be used as a substitute for specific legal advice or opinions. You should not act or refrain from acting on the basis of this response without first seeking appropriate legal advice.

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