When is the Ledgers initial franchise fee considered fully earned?
Ledgers Franchise · 2025 FDDAnswer from 2025 FDD Document
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F. Control of Proceedings.
We have the sole right to control any administrative proceedings or litigation involving a trademark licensed by us to you.
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Source: Item 22 — CONTRACTS (FDD page 46)
What This Means (2025 FDD)
According to Ledgers's 2025 Franchise Disclosure Document, the initial franchise fee is considered fully earned and nonrefundable once both parties (Ledgers and the franchisee) have executed the Franchise Agreement. The initial franchise fee for a Ledgers franchise is $15,000.
This means that once the agreement is signed by both Ledgers and the franchisee, Ledgers is entitled to keep the $15,000 regardless of whether the franchisee ever opens their business or if the agreement is terminated. This is a standard practice in franchising, as the initial fee is intended to compensate the franchisor for the costs associated with granting the franchise and providing initial training and support.
However, there is an exception for California and North Dakota franchisees. The FDD states that the franchisor defers the collection of all initial fees from North Dakota franchisees until the franchisor has completed all its pre-opening obligations and franchisee is open for business. The Department of Financial Protection and Innovation requires that the franchisor defer the collection of all initial fees from California franchisees until the franchisor has completed all its pre-opening obligations and franchisee is open for business. Therefore, in these states, the initial fee is not fully earned until Ledgers has fulfilled its pre-opening obligations and the franchisee's business is open.