For Ledgers franchises in Maryland, what is the significance of the financial assurance 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, the Maryland Securities Commissioner requires a financial assurance based on Ledgers' financial condition. This requirement directly impacts the payment of initial fees and payments for franchisees in Maryland. Specifically, all initial fees and payments owed by franchisees in Maryland are deferred. This deferral remains in effect until Ledgers completes its pre-opening obligations as outlined in the franchise agreement.
This condition set by the Maryland Securities Commissioner serves as a protection for franchisees. By deferring the initial fees, the franchisee is not required to pay these fees until Ledgers has fulfilled its obligations to help the franchisee get started. This reduces the franchisee's risk, as they are not investing heavily upfront before Ledgers has provided the agreed-upon support and services.
For a prospective Ledgers franchisee in Maryland, this means they will not need to pay the initial franchise fee until Ledgers has met its pre-opening obligations. This could include site selection assistance, training, providing operations manuals, and other support services necessary to launch the franchise. Franchisees should confirm with Ledgers exactly what constitutes the completion of these pre-opening obligations to understand when the initial fees will become due.