For Ledgers franchises in Indiana, what is the relationship between the territory granted and the geographic area of non-competition?
Ledgers Franchise · 2025 FDDAnswer from 2025 FDD Document
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- In compliance with Indiana Code 12-2-2.7-1(9), any provisions in this Franchise Agreement relating to non-competition upon the termination or non-renewal of the Franchise Agreement shall be limited to a geographic area not greater than the Territory granted in this Franchise Agreement and shall be construed in accordance with Indiana Code 23-2-2.7-1(9).
Source: Item 22 — CONTRACTS (FDD page 46)
What This Means (2025 FDD)
According to Ledgers' 2025 Franchise Disclosure Document, Indiana law impacts the non-compete provisions within the franchise agreement. Specifically, for Ledgers franchises operating in Indiana, any non-competition agreement that restricts a franchisee after the termination or non-renewal of the franchise is limited to a geographic area no larger than the territory originally granted to the franchisee.
This means that if a Ledgers franchisee in Indiana leaves the system, they can only be restricted from operating a competing business within the same territory they were initially granted. This provides some protection to Ledgers, ensuring that former franchisees do not directly compete in the same area immediately after leaving the franchise system.
This is a notable protection for franchisees in Indiana, as it prevents Ledgers from enforcing overly broad non-compete agreements that could severely limit a former franchisee's ability to earn a living. Prospective franchisees should carefully review Schedule 1 of the Franchise Agreement, as referenced in the FDD, to fully understand the geographic boundaries of the territory they are granted, as this will directly correlate to the area in which the non-compete restrictions apply should they leave the Ledgers system.