Football season is in full swing, and franchise development teams are pushing hard to meet year-end goals.  For most franchisors, this marks the final quarter of their fiscal years.  While the 2026 “FDD Renewal Season” looms ahead, it’s crucial to remember that franchisors have a continuing obligation to monitor and evaluate the information disclosed in their 2025 Franchise Disclosure Documents (FDDs).  Any material changes that have occurred since the 2025 FDDs were issued must be addressed through timely amendments.

This summer, the North American Securities Administrators Association (NASAA) issued guidance titled “Impact of Shifting Market and Economic Factors on Franchise Disclosures.” While the guidance did not create new obligations for franchisors, it served as a timely reminder of their ongoing duty to ensure the accuracy of their FDDs. NASAA highlighted how evolving conditions—such as tariffs, natural disasters, inflation, war and unrest, epidemics and pandemics, labor disputes, recession, economic growth, and new technology—might materially affect franchisors, their franchise systems, and the information provided in their FDDs. The guidance emphasized that franchisors must actively assess whether these factors have triggered changes that require updates to their FDDs.

When evaluating whether a material change may have occurred, franchisors should consider the following:

• Financial Condition: Has franchisor’s financial condition changed significantly?
• Fees: Have any new fees been introduced, or have existing fees been modified?
• Initial Investment: Does the initial investment range in Item 7 still provide a realistic estimate for a typical outlet (g., have tariffs increased costs)?
• Closures/Terminations: Has the system experienced a notable number of closures or terminations this year?
• Litigation/Arbitration: Are there any material updates to litigation or arbitration disclosed in Item 3, or any new matters that must be disclosed?
• Opening Timeline: Have supply chain disruptions caused material delays in franchisees commencing operations?
• Financial Performance Representations: Does the franchisor still have a reasonable basis for any financial performance representations included in Item 19?

There is not a strict checklist for determining materiality for specific events.  It must be done on a case-by-case basis.  Therefore, it’s essential that franchisors conduct a thoughtful analysis of each event, and remember to consider materiality from the perspective of a prospective franchisee, to determine whether updates to their FDD are required. Staying proactive in this review process helps ensure ongoing compliance with both federal and state franchise laws.