Section 445.512. Statement of controlling company.

A complete financial statement  of   a  company  controlling   the franchisor shall be required when the controlling company guarantees to assume the duties and obligations of the franchisor under the franchise agreement. If  the franchisor wishes to  file  a   controlling  company financial  statement,   the controlling company shall guarantee the obligations of the franchisor or post an acceptable surety bond at the discretion of the franchisor. Such surety bond must be purchased from a surety company authorized to transact business in the state of Michigan and in an amount required by the administrator as protection of the public requires. The amount may be amended by the administrator on  the  basis  of the amount of fees and the number of franchises sold. If the surety bond is terminated or canceled while the franchisor is  still  under  an obligation to provide real   estate, improvements, equipment, inventory, training or other items, another surety bond acceptable to the administrator   must  be  purchased  or   a  guarantee   acceptable  to the administrator of the franchisor's   obligations  must   be  given  before additional sales can be made.

History: 1979 AC.