In Indiana, for how long after termination of the Ledgers Franchise Agreement are franchisees prohibited from being involved in a competing business within their exclusive Franchise Territory?
Ledgers Franchise · 2025 FDDAnswer from 2025 FDD Document
The following are revisions to Item 17 of the Disclosure Document:
Indiana Code section 23-27-1(9) prohibits provisions in contract which require a franchisee to agree to a covenant not to compete with the franchisor for a period longer than three (3) years or in an area greater than the exclusive area granted by the Franchise Agreement upon termination or failure to renew the Franchise Agreement. Accordingly, in the State of Indiana, upon termination of the Franchise Agreement, you cannot be involved in a competing business for one (1) year within your exclusive Franchise Territory.
Source: Item 22 — CONTRACTS (FDD page 46)
What This Means (2025 FDD)
According to the 2025 Ledgers Franchise Disclosure Document, Indiana franchisees face a one-year non-compete restriction within their exclusive territory after the termination of their Franchise Agreement. This is due to Indiana Code section 23-27-1(9), which limits non-compete agreements to a maximum of three years and restricts the area to the franchisee's exclusive territory.
This means that if a Ledgers franchisee in Indiana decides to leave the franchise system, they cannot engage in a competing accounting or tax service business within their previously assigned territory for one year. This restriction aims to protect Ledgers's business interests and client relationships within that territory.
Prospective franchisees in Indiana should be aware of this restriction as it could impact their future career options if they choose to exit the Ledgers franchise. It is important to carefully consider the implications of this non-compete clause before entering into a franchise agreement with Ledgers in Indiana.