What is the dependency for when initial fees and payments are owed by Ledgers franchisees in Maryland?
Ledgers Franchise · 2025 FDDAnswer from 2025 FDD Document
- D. Item 5 of the FDD and Section 2.1 of the FA are modified with the addition of the following language:
- "Based upon the franchisor's financial condition, the Maryland Securities Commissioner has required a financial assurance. Therefore, all initial fees and payments owed by franchisees shall be deferred until the franchisor completes its pre-opening obligations under the franchise agreement. "
Source: Item 22 — CONTRACTS (FDD page 46)
What This Means (2025 FDD)
According to Ledgers's 2025 Franchise Disclosure Document, for franchisees in Maryland, the payment of initial fees is contingent upon Ledgers completing its pre-opening obligations under the franchise agreement. This means that a new Ledgers franchisee in Maryland will not be required to pay any initial fees until Ledgers has fulfilled all of its responsibilities related to setting up the franchise location.
This requirement is due to a financial assurance mandated by the Maryland Securities Commissioner based on Ledgers's financial condition. This deferral provides a level of financial protection for the franchisee, ensuring that they are not paying fees upfront before Ledgers has delivered on its promises of support and setup.
This condition modifies Item 5 of the FDD and Section 2.1 of the Franchise Agreement, highlighting the importance of carefully reviewing state-specific addenda within the FDD to understand any variations from the standard agreement. Prospective franchisees should confirm with Ledgers exactly what constitutes the 'pre-opening obligations' and the expected timeline for their completion.