What constitutes 'good cause' for Ledgers to terminate a franchise and repurchase the business?
Ledgers Franchise · 2025 FDDAnswer from 2025 FDD Document
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- If you make a material misstatement of fact or fail to disclose a material fact on a Biographical Information Form or in any requested form including the request for consideration or application,
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- If you refuse to completely fill out a requested form or tender supporting documentation upon reasonable request;
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- You become insolvent, meaning unable to pay your bills in the ordinary course as they become due;
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- If a final judgment of record against you or your Franchise Business remains unsatisfied for thirty (30) days or longer;
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- If on your death or incapacity, the transfer process does not begin within sixty (60) days or remains incomplete after 6 months; or
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- If you abandon the Franchised Business or discontinue the active operation of the Franchised Business for three or more business days, except when active operation is not reasonably possible, such as because of a natural disaster or government order.
8.3. Termination by Us with the Opportunity to Cure
We may terminate this Agreement, if the following conditions remain within thirty (30) days after sending you notice and an opportunity to cure:
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- You violate any other term or condition of this Agreement, the Franchisee Operations Manual, or any other agreement with us; or
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- Any amount owing to us from you is more than 30 days past due.
8.4. No Refund of Initial Fee
We have no obligation to return or refund any fee to you upon termination or expiration of this Agreement.
8.5. Post Termination Obligations
Upon termination or expiration of this Agreement, including a sale of the Franchise Business, you will:
Source: Item 22 — CONTRACTS (FDD page 46)
What This Means (2025 FDD)
According to Ledgers' 2025 Franchise Disclosure Document, Ledgers can terminate the franchise agreement under specific conditions, some with an opportunity for the franchisee to correct the issue. Ledgers may terminate the agreement without an opportunity to cure under the following conditions: if the franchisee makes a material misstatement of fact or fails to disclose a material fact on a Biographical Information Form or in any requested form including the request for consideration or application; if the franchisee refuses to completely fill out a requested form or tender supporting documentation upon reasonable request; if the franchisee becomes insolvent; if a final judgment of record against the franchisee or their Franchise Business remains unsatisfied for thirty (30) days or longer; if on the franchisee's death or incapacity, the transfer process does not begin within sixty (60) days or remains incomplete after 6 months; or if the franchisee abandons the Franchised Business or discontinues the active operation of the Franchised Business for three or more business days, except when active operation is not reasonably possible, such as because of a natural disaster or government order.
Ledgers may terminate the Franchise Agreement if the following conditions remain within thirty (30) days after sending the franchisee notice and an opportunity to cure: if the franchisee violates any other term or condition of this Agreement, the Franchisee Operations Manual, or any other agreement with Ledgers; or any amount owing to Ledgers from the franchisee is more than 30 days past due.
It is important to note that upon termination or expiration of the Franchise Agreement, Ledgers has no obligation to return or refund any fee to the franchisee. Furthermore, the franchisee has post-termination obligations, including non-compete and no solicitation clauses that extend for a period of two (2) years after expiration or termination of the agreement within the Territory or within twenty-five (25) miles of the boundaries of the Territory.