3.2.6 Indiana

Fees

*Renewal filings must be submitted at least one day prior to the registration expiration date or Indiana will require the filing be resubmitted as a new initial filing with payment of the initial fee.

**Post-Effective Amendment filings must be submitted if you are making a material change to your FDD after your initial or renewal filing is approved.

Notes

• Indiana filings are completed online and payment of filing fees may be made via ACH or credit card. For ACH payments, you will be required to complete and submit an ACH authorization form to us before we will submit the filing for you, and the state will charge a $1.00 convenience fee for payments submitted via ACH.  For credit card payments, you will be required to complete and submit a credit card authorization form to us before we will submit the filing for you.  Indiana will charge convenience fees that range between $5 and $12 depending on whether the filing is an initial or a renewal.
• We will provide the Indiana application to you via email or DocuSign for signatures. If we provide the forms via email, you must print them and sign them with notary public (where applicable) and scan all pages back to us via email so we may complete the filing on your behalf.
• Indiana requires the submission of the current FDD, but the review of the document is limited and initial filings are usually approved within a few weeks. Renewals and amendments are effective upon receipt.

Exemptions (from registration with the state and/or from disclosure with a specific prospect)

• Large Franchisors – exemption from registration only
  • Both the net worth and experience criteria must be met
    1. Net worth:
       • Minimum net worth of $5,000,000 (audited); OR
       • Minimum net worth of $1,000,000 (audited) if you are at least 80% owned by a corporation that has minimum net worth (audited) of $5,000,000
    2. Experience:
       • You or a corporation owning 80% of you must have:
         • At least 25 franchisees conducting business at all times during prior five-year period; OR
         • Continuously conducted the business that is the subject of the franchise for at least the five years preceding the offer or sale.
  • No filing or fees are required

• Fractional Franchises – exemption from registration and disclosure
  • Where franchisee or any of its directors or officers at the time the contract is signed (1) have been in the type of business represented by the franchise or similar business for at least two years; and (2) parties to contract anticipated or should have anticipated at time of signing that franchisee’s gross sales from the franchised business during first year would not be more than 20% of gross sales of the franchisee’s business operations.
  • No filing or fees are required
  • N.B.: There is little direction in the Indiana statutes to explain what may happen if the franchisee does exceed the 20% of gross sales criteria. Please speak with your Spadea team for guidance if there is any doubt.
• Renewal of an Existing Agreement – exemption from registration and disclosure
  • Where the renewal or extension is (1) for an existing franchise; and where (2) there has been no interruption in operation of the franchise by the franchisee
  • No filing or fees are required
• Isolated Sales – exemption from registration and disclosure
  • If you sell no more than one franchise in any 24-month period
  • No filing or fees are required
• Sales by Existing Franchisees – exemption from registration and disclosure
  • Offer of or sale of a franchise by franchisee who is not an affiliate of yours for the franchisee’s own account, provided the offer or sale is not effected by or through you
  • No filing or fees are required
• Out-of-State Sales – exemption from registration and disclosure
  • Offers or sales made in Indiana are exempt as long as (1) offeree or franchisee is not an Indiana resident; and (2) the franchised business will not be operated in Indiana
  • No filing or fees are required
• Non-Franchisor Exemptions – The following exemptions are for atypical franchise offerings, are very rare, and in general, will not apply to you if you are an active franchisor with an FDD.
  • By Order