For Ledgers franchises in Maryland, what is the required action for the franchisor to provide a financial assurance, as required by the Maryland Securities Commissioner?
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' 2025 Franchise Disclosure Document, if the Maryland Securities Commissioner requires a financial assurance due to the franchisor's financial condition, all initial fees and payments owed by franchisees in Maryland will be deferred. This deferral remains in effect until Ledgers completes its pre-opening obligations as outlined in the franchise agreement.
This modification to Item 5 of the FDD and Section 2.1 of the Franchise Agreement means that prospective Ledgers franchisees in Maryland will not have to pay any initial fees until Ledgers has fulfilled its pre-opening responsibilities. This provides a level of financial protection to the franchisee, ensuring that they are not paying fees upfront if Ledgers is unable to meet its obligations.
This requirement is specific to Maryland and is based on the Maryland Securities Commissioner's assessment of Ledgers' financial condition. It is designed to protect franchisees in Maryland from potential financial loss if Ledgers were to fail to provide the agreed-upon pre-opening support. Prospective franchisees should carefully review Item 5 of the FDD and Section 2.1 of the Franchise Agreement to fully understand Ledgers' pre-opening obligations and the conditions under which the initial fees will become due.