Under what conditions can Ledgers terminate the Franchise Agreement with cause?
Ledgers Franchise · 2025 FDDAnswer from 2025 FDD Document
THE FRANCHISE RELATIONSHIP*
This table lists important provisions of the franchise and related agreements. You should read these provisions in the agreements attached to this Disclosure Document.
| Provision | Section In Franchise Agreement | Summary |
|---|---|---|
| a. Length of the franchise term b. Renewal or extension of the term | 1.2.A 1.2.B | 10 years. Can be renewed for successive terms if you are in compliance with your Franchise Agreement ("Agreement"). |
| c. Requirements for you to renew or extend | 1.2.B | Renewing your Franchise Agreement means that you are able to continue your operations as a franchisee for an additional term. You must sign a general release of claims, notify us in writing at least 90 days before the expiration of the Agreement, and sign our then current Agreement, which may not contain materially different terms and conditions than your original contract. |
| d. Termination by franchisee | 7.2 | You may terminate the Agreement if you sell the franchise pursuant to the terms of the Franchise Agreement, do not renew, or under any grounds permitted by applicable state law. |
| e. Termination by franchisor | None | Not applicable |
| without cause | ||
| f. Termination by franchisor | 8.2., 8.3 | We can terminate only if you default. |
| with cause | ||
| g. "Cause" defined – curable defaults | 8.3 | Violate the Agreement, Manual, any other agreement with us, or owe monies to us more than 30 days past due, and do not cure such breach within 30 days after notice. |
| h. "Cause" defined – non curable defaults | 8.2 | Do not pass Initial Training, fail to obtain our approval of a site or open on time, become insolvent, commit a material violation of law, abandon the Franchised Business, submit a materially false Franchise Application, fraud, uncured default of other agreement, fail to pay suppliers an amount exceeding $3,000 for more than 60 days; fail to permit us to inspect or audit |
| Provision | Section In Franchise Agreement | Summary |
| -------------------------------------------------------- | -------------------------------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |
| your franchise; or commit three or more breaches within 12 months. | ||
| i. Franchisee's obligations on termination/renewal | 8.5 | Cease operations and stop using our Marks; deliver to us business records; pay debts due to us; cancel or assign telephone numbers to us; assist in lease transfer and our purchase of your assets, at our option; return Manual and Confidential Information to us; cancel fictitious names; adhere to other post term duties; execute any necessary documents. |
| j. Assignment of contract by | 7.1 | We may assign to a successor in interest who |
| franchisor | remains bound by terms of Agreement. | |
| k. |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 38–41)
What This Means (2025 FDD)
According to Ledgers' 2025 Franchise Disclosure Document, Ledgers can terminate the Franchise Agreement with cause if the franchisee defaults. The defaults are categorized as either curable or non-curable.
Curable defaults include violating the Franchise Agreement, the Franchisee Operations Manual, or any other agreement with Ledgers, or owing monies to Ledgers that are more than 30 days past due. In these cases, Ledgers must provide the franchisee with a 30-day notice and an opportunity to cure the breach.
Non-curable defaults include failing to pass initial training, failing to obtain Ledgers' approval of a site or opening on time, becoming insolvent, committing a material violation of law, abandoning the Franchised Business, submitting a materially false Franchise Application, fraud, uncured default of other agreement, failing to pay suppliers an amount exceeding $3,000 for more than 60 days, failing to permit Ledgers to inspect or audit the franchise, or committing three or more breaches within 12 months. Additionally, Ledgers can terminate the agreement if the franchisee makes a material misstatement of fact or fails to disclose a material fact on a Biographical Information Form or in any requested form, refuses to completely fill out a requested form or tender supporting documentation upon reasonable request, a final judgment of record against the franchisee or their Franchise Business remains unsatisfied for thirty (30) days or longer, or if on the franchisee's death or incapacity, the transfer process does not begin within sixty (60) days or remains incomplete after 6 months.
It is important for a prospective Ledgers franchisee to understand these conditions, as termination of the agreement would result in the franchisee ceasing operations and losing their franchise. Franchisees should carefully review the Franchise Agreement and Operations Manual to ensure compliance and avoid potential defaults.