CONFIRMEDboth documents are BAM’s own; one of them is verified under oath by its chief executive
BAM’s Franchise Disclosure Document, issuance date March 31, 2023 (Minnesota CARDS file E0034F88), Item 10, hosted in excerpt below; BAM’s verified complaint in Utah case 260402353, paragraph 22 and the verification page, hosted in excerpt below. Unadjudicated; everyone named is presumed innocent.
On February 2, 2023, according to BAM’s own sworn complaint, BAM confirmed a security interest in a signed Security Agreement covering the Salem store’s accounts, inventory, and equipment, the instrument a secured creditor takes when it finances a purchase. Fifty-seven days later, on March 31, 2023, BAM issued the year’s Franchise Disclosure Document, the filing whose legal function is to tell prospective franchisees the truth. Its financing section reads: “We do not offer financing, directly or indirectly, for any part of the initial investment for a Franchise.” Both documents are BAM’s. The one describing the security agreement is verified under oath by the company’s chief executive. They describe the same company, in the same two months, in opposite postures.
A franchisor selling franchises in the United States must give every prospective buyer a Franchise Disclosure Document, and federal rule 16 CFR 436 prescribes its contents. Item 10 is the financing disclosure: it is where a prospective franchisee learns whether the franchisor, or anyone acting with it, offers financing for the purchase, directly or indirectly. BAM’s Item 10, in the edition issued March 31, 2023, disposes of the subject in one sentence: “We do not offer financing, directly or indirectly, for any part of the initial investment for a Franchise.” The same sentence appears in the edition BAM filed with Minnesota in April 2024 (CARDS filing 31301-202404-06).
BAM’s verified complaint against the journalist and others, filed May 27, 2026 in Utah’s Fourth District (case 260402353), describes the Salem store’s February 2023 change of hands. Paragraph 22 reads, in the complaint’s own words:
“Significantly, BAM was granted a ‘security interest’ referenced in APA Section 3 and confirmed in a signed 2/2/23 Security Agreement, in and to [A]ll accounts, chattel paper, general intangibles, inventory, and equipment of Debtor…”
A security interest is the interest a secured creditor holds in a debtor’s collateral, the arrangement that exists when a purchase is financed and the financier secures repayment against the assets. The complaint invokes it to establish BAM’s priority claim to the Salem store’s inventory. And the complaint is not a lawyer’s characterization alone: its final page carries a verification, signed by Ammon McNeff “individually and in my capacity as Chief Executive Officer and owner of BAM Franchising, Inc.,” stating that he has read the complaint and that “the foregoing allegations are true and correct to the best of my knowledge, information and belief.”
The sequence, on the two documents’ own dates: February 2, 2023, BAM confirms a security interest in a signed Security Agreement on the Salem purchase, per its own sworn pleading. February 3, 2023, BAM signs the Salem franchise agreement. March 31, 2023, BAM issues the Franchise Disclosure Document stating that it does not offer financing, directly or indirectly, for any part of the initial investment. The security agreement predates the disclosure by fifty-seven days. The sentence remained in the next year’s edition. A prospective franchisee reading Item 10 in either year would have had no way to learn, from the document built for that purpose, that the franchisor had taken a secured position on a franchisee’s purchase.
The contradiction joins a pattern this site has documented in the same filing series: the litigation section’s certification, examined in the “no litigation” stress test, and the audited going-concern arithmetic, examined in the clean-opinion analysis. Item 10 is narrower than either: one sentence, one signed instrument, fifty-seven days apart.
The fair counterpoint. BAM has a colorable reading. Item 10 speaks to financing a franchisor “offers,” and BAM could characterize the Salem arrangement as a one-time seller-carry structure inside a resale, negotiated with a specific buyer, rather than a financing program offered to prospective franchisees. Whether a single secured acquisition arrangement must be disclosed under the rule’s “directly or indirectly” language is a legal question no court has answered in this case. The security agreement’s parties and terms will be tested in the pending litigation, not in a disclosure document, and BAM is presumed to have acted lawfully.
Sources: BAM Franchise Disclosure Document, issuance March 31, 2023, cover and Item 10 pages, hosted excerpt (full document on file with the Minnesota Department of Commerce, CARDS file E0034F88); the April 2024 Minnesota filing, CARDS 31301-202404-06, cited by file number; BAM’s verified complaint, Utah Fourth District case 260402353, caption, paragraph 22, and verification pages, hosted excerpt; the Salem franchise agreement date per the exhibits in Utah case 260200029, cited by case number. Related: the Item 3 certification, stress-tested; the consignment sentence’s four versions.
The BAM Map is independent reporting on matters of public concern. Nothing here is a finding of any person’s guilt; the criminal charges referenced are unadjudicated and every defendant is presumed innocent. Sources are linked so readers can check the record. · Home · Map · The law · Bodycam