Don't Sign An Agreement To Receive Information

Fraud Alert: No Agreements (e.g. Non-Disclosure Agreements) Need Be Signed to Receive Franchise Disclosure Documents or Attend Discovery Day 

There are franchise investment offerings that are so transparently not innovative, and that can so easily be done without whatever it is that the franchisors pretend they have that is “unique” (yeah, right). They request that a prospect sign a non-disclosure agreement / confidentiality agreement as a condition to being sent the offering circular or to being allowed to attend “discovery day”.

You are not required to sign any agreement in order to get franchise disclosure materials (The UFOC), except that you are normally asked to sign and return a receipt to acknowledge that you actually received the materials. Read the receipt carefully to see that all you are acknowledging is that you received the UFOC on a particular date. If it says anything else, don’t sign it and write that franchise company off your list of investment candidates. The same admonition goes for your participation in “discovery day” visits, when they give you the grand tour of their “wonderful” stuff. Franchisors never disclose trade secrets or confidential information on discovery day. Anyone requesting you to sign a non-disclosure or confidentiality agreement in order to get into “discovery day” is a crook who is misrepresenting that what you will see is so special that they have the right to protect it from being used by anyone other than its franchisees. The truth is that it is obvious and they are trying to pull a fast one on you to frighten you out of doing whatever it is that they want to franchise on your own without buying their franchise. 

If any franchisor asks or requires you to sign any agreement of any kind whatsoever - especially a non disclosure agreement, but certainly not limited to that – don’t sign it and move on. Do not have any further contact with that franchisor. That franchise is per se not investment worthy, and the franchisor is trying to pull a fast one.

The same warning applies if they want you to sign anything at all before you go to “Discovery Day”. You are dealing with a bozo franchise and they are just looking to get a handle on you so that they can threaten you if you don’t buy the franchise and decide to do anything else on your own that may be in a similar business. Don’t sign it and don’t go to discovery day with anyone like that. These are vicious and dangerous people, to be avoided.

These are devices now being used  by people who really have nothing unique or special, and whose business can easily be done without signing any agreements with them. They are using the threat of potential lawsuits against you under whatever it is that they are asking you to sign as a tool of their marketing program, and you may not realize that in time to avoid the problem. 

THE ONLY THING YOU SHOULD CONSIDER SIGNING IS A SIMPLE RECEIPT THAT SAYS NOTHING – ABSOLUTELY NOTHING – OTHER THAN THE SIMPLE STATEMENT THAT YOU RECEIVED THEIR UFOC ON A STATED DATE. IF IT SAYS ANYTHING OTHER THAN THAT SIMPLE STATEMENT, DON’T SIGN IT.