What item of the Ledgers FDD is modified regarding the deferral of initial fees and payments?
Ledgers Franchise · 2025 FDDAnswer from 2025 FDD Document
s:
Commissioner of Securities of the State of Hawaii Department of Commerce and Consumer Affairs Business Registration Division Securities Compliance Branch 335 Merchant Street, Room 203 Honolulu, HI 96813
Initial Fee Deferral:
Item 5 of the FDD is modified with the addition of the following language: 'The franchisor defers the collection of all initial fees from Hawaii franchisees until the franchisor has completed all its pre-opening obligations and franchisee is open for business.
ILLINOIS
As to franchises governed by the Illinois Franchise Disclosure Act, if any of the terms of the Disclosure Document or Franchise Agreement are inconsistent with the terms below, the terms below control.
- A. Illinois law governs the Franchise Agreement.
- B. In conformance with Section 4 of the Illinois Franchise Disclosure Act, any provision in a franchise agreement that designates jurisdiction and venue in a forum outside of the State of Illinois is void. However, a franchise agreement may provide for arbitration to take place outside of Illinois.
- C. The conditions under which your Franchise Agreement can be terminated and your rights upon nonrenewal may be affected by Sections 19 and 20 of the Illinois Franchise Disclosure Act.
- D. In conformance with Section 41 of the Illinois Franchise Disclosure Act, any condition, stipulation, or provision of the Franchise Agreement purporting to bind you to waive compliance with any provision of the Illinois Franchise Disclosure Act or any other law of the State of Illinois is void.
- E. Item 5 of the FDD and Item 2.1 of the Franchise Agreement are modified with the addition of the following language: 'The franchisor defers the collection of all initial fees from Illinois franchisees until the franchisor has completed all its pre-opening obligations and franchisee is open for business."
- F.
Source: Item 22 — CONTRACTS (FDD page 46)
What This Means (2025 FDD)
According to Ledgers' 2025 Franchise Disclosure Document, Item 5 of the FDD is modified concerning the deferral of initial fees and payments for franchisees in certain states. Specifically, for North Dakota, the collection of all initial fees is deferred until Ledgers has completed all its pre-opening obligations and the franchisee is open for business.
For South Dakota, Item 5 of the FDD and Item 2.1 of the Franchise Agreement are modified to defer the collection of all initial fees until the franchisee is open for business. In California, Item 5 of the FDD and Section 2.1 of the Franchise Agreement are modified to defer the collection of all initial fees until Ledgers has completed all its pre-opening obligations and the franchisee is open for business, as required by the Department of Financial Protection and Innovation.
In Virginia, Item 5 of the Disclosure Document is modified to defer payment of the initial franchise fee and other initial payments until Ledgers has completed its pre-opening obligations under the franchise agreement, as required by the Virginia State Corporation Commission's Division of Securities and Retail Franchising. For Maryland, Item 5 of the FDD and Section 2.1 of the FA are modified to defer all initial fees and payments until Ledgers completes its pre-opening obligations under the franchise agreement, based on Ledgers' financial condition and the requirement of a financial assurance by the Maryland Securities Commissioner.
For Minnesota, FDD Item 5 and Item 7 are modified to defer payment of the initial franchise fee until the franchisee has opened the franchised business, as required by the Minnesota Department of Commerce. Additionally, FA Section 2.1 is modified to state that payment of the Initial Fee is deferred until the franchisee has opened the franchised business. This deferral of initial fees and payments can significantly reduce the upfront financial burden on new franchisees, allowing them to allocate resources to setting up and launching their Ledgers franchise.