The FDD / UFOC Disclosure Document
The Franchise Disclosure Document (FDD) is a disclosure document given to prospective franchisees, i.e. you, by the franchisor. Up unitl 2009, this document was called the UFOC (Uniform Franchise Offering Circular). Use it to help determine whether or not any franchise opportunity can generate the earnings, working environment and lifestyle you require.
|The FDD document includes:
- Legal documents such as franchise agreements, area developer agreements, non-disclosure agreements, guarantees and other legal documents that the Franchisor will require all new franchisees to sign prior to being awarded a franchise. Reviewing these items allows you to research the franchise thoroughly and ultimately decide if it is a good franchise investment for you.
- The FDD contains several sections, or "items" outlining all areas of the business. Read through the items carefully.
- The beginning of the FDD contains a cover page that outlines the total estimated costs including the initial franchise fees as well as some of the risks for that particular franchise system.
Click any line below to see:
FDD Franchise Disclosure Document
Sample franchise agreement
For a free fdd disclosure document for a specific franchise, click:
Free UFOC -FDD Disclosure Document
The Federal Trade Commission (FTC) requires
franchisors to provide you a Franchise Disclosure Document "upon
reasonable request." The document includes the franchise
agreement and all other contracts and terms for you to review
as part of your due diligence process.
Click any link below for further information on any FDD Section. (item)
- Item 1 - The franchisor (and any predecessor's) background includes any affiliates
- Item 2 – Business Experience
- Item 3 - Bankruptcy
- Item 4 - Litigation history
- Item 5 - Initial franchisee fees
- Item 6 - Ongoing fees
- Item 7 - Franchisees required initial investment
- Item 8 - Restriction on sources of products and services
- Item 9 - Franchisee's obligations
- Item 10 - Financing agreement
- Item 11 - Obligation of the franchisor – training, support, marketing, etc
- Item 12 - Exclusive/designated territory
- Item 13 - Trademarks
- Item 14 - Patents and copyrights
- Item 15 - Obligations of the franchisee to participate in the actual operation of the franchise business
- Item 16 – Restriction on what the franchisee can sell, i.e. goods and service
- Item 17 - Renewal, termination, transfer, and dispute resolution
- Item 18 - Arrangements with public figures
- Item 19 - Financial performance representations - actual, average, projected or forecasted franchise sales, profits or earnings.
- Item 20 - Current franchisee/franchise outlet information. Includes contact information of franchisees past and present
- Item 21 - Financial statements
- Item 22 - Contracts
- Item 23 - Acknowledgement receipt
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