What constitutes a default of the Card My Yard Franchise Agreement that would prevent a transfer?
Card_My_Yard Franchise · 2025 FDDAnswer from 2025 FDD Document
- (1) All accrued monetary obligations of you and your Affiliates to us and our Affiliates arising under this Agreement or any other agreement,shall have been satisfied in a timely manner, and you shall have satisfied
all trade accounts and other debts of whatever nature or kind in a timely manner;
(2) You and your Affiliates shall not be in default of this Agreement or any other agreement with us or our Affiliates, and you and they shall have substantially and timely complied with all the terms and conditions of such agreements during their respective terms;
(3) The transferor and its owners,if applicable, shall have executed a general release, in a form satisfactory to us, of any and all claims, against us and our Affiliates, our and their respective officers, directors, shareholders, partners, members, agents, representatives, independent contractors, servants and employees, past and present, in their corporate and individual capacities,including, without limitation, claims arising under this Agreement and any other agreement with us or our Affiliates, and under federal, state or local laws, rules, and regulations or orders;
Source: Item 23 — RECEIPTS (FDD pages 84–259)
What This Means (2025 FDD)
According to the 2025 Card My Yard Franchise Disclosure Document, a franchisee's ability to transfer their franchise is contingent upon several factors, including not being in default of the Franchise Agreement or any other agreements with Card My Yard or its affiliates. This means that if a franchisee has failed to meet their obligations under the agreement, such as making timely payments or complying with operational standards, they may be prevented from transferring the franchise to a new owner.
The FDD specifies that all accrued monetary obligations to Card My Yard and its affiliates must be satisfied in a timely manner, and all trade accounts and other debts must also be settled promptly. Furthermore, the franchisee and their affiliates must have substantially and timely complied with all the terms and conditions of their agreements with Card My Yard during their respective terms. Any failure to meet these financial and operational requirements could constitute a default that would prevent the transfer of the franchise.
In addition to these conditions, the transferor must also execute a general release of any and all claims against Card My Yard and its affiliates. This release covers claims arising under the Franchise Agreement, other agreements, and federal, state, or local laws. This requirement ensures that Card My Yard is protected from any potential legal issues related to the franchisee's operation of the business prior to the transfer. Therefore, a franchisee needs to be in good standing with Card My Yard, both financially and operationally, to be eligible to transfer their franchise.