Under what conditions can 7 Brew draft monies from a franchisee's bank account related to gift/loyalty/stored-value cards?

According to 7 Brew's 2025 Franchise Disclosure Document, 7 Brew may draft monies from a franchisee's bank account related to gift, loyalty, and stored-value cards under specific conditions. 7 Brew may draft all monies paid to the franchisee for these cards and similar customer loyalty initiatives. The company will hold these funds until the cards or initiatives are redeemed at the franchisee's store or another 7 Brew location.

This means that while franchisees receive initial payments for these cards, they do not retain those funds immediately. Instead, 7 Brew holds the money and only disburses it when the cards are actually used to make purchases. This system ensures that 7 Brew maintains control over the funds and can track the liabilities associated with outstanding gift, loyalty, and stored-value cards across the entire franchise system.

However, 7 Brew may retain any prepaid amounts that customers do not use, to the extent allowed by law. Additionally, 7 Brew is not obligated to reimburse franchisees for any costs they incur while participating in these programs. This includes the cost of providing products or services to customers without direct compensation when they redeem their cards or loyalty rewards.

For a prospective franchisee, this indicates a potential financial responsibility to provide goods/services without immediate reimbursement, as well as the risk of losing revenue from unredeemed cards if legally permissible. It is important to understand the specific laws governing unredeemed gift cards in the franchisee's location and to factor these potential costs into their financial projections.