Can a Card My Yard franchisee give away their interest in the agreement?
Card_My_Yard Franchise · 2025 FDDAnswer from 2025 FDD Document
ith or, acquire other corporations, or may be acquired by another corporation; may undertake a refinancing, recapitalization, leveraged buyout or other economic or financial restructuring.
- B. By You and Your Owners. You acknowledge that the rights and duties set forth in this Agreement are personal to you, and that we have granted you rights under this Agreement in reliance on your business skill, financial capacity and personal character and that of your Owners. Accordingly, neither you nor any of your Owners, nor any of your or their permitted successors or assigns, shall sell, assign, transfer, convey, give away, pledge, mortgage or otherwise dispose of or encumber any direct or indirect interest in this Agreement (including any zip codes or other partial territorial rights under this Agreement), in the Card My Yard business or the assets of such business, or in you without our prior written consent. Any purported assignment or transfer, by operation of law or otherwise, made in violation of this Agreement shall be null and void and shall constitute a material breach of this Agreement. If you wish to transfer all or part of your interest in the Card My Yard business or this Agreement, or if you or an Owner wishes to transfer any ownership interest in you, the transferor shall apply to us for our consent. We will not unreasonably withhold our consent but may require any or all of the following as conditions of our consent:
- (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 Card My Yard's 2025 Franchise Disclosure Document, franchisees cannot give away their interest in the Franchise Agreement without prior written consent from Card My Yard. The document states that the rights and duties within the agreement are personal to the franchisee, and Card My Yard has granted these rights based on the franchisee's business skill, financial capacity, and personal character, as well as those of their owners.
Specifically, franchisees (or their owners) cannot sell, assign, transfer, convey, give away, pledge, mortgage, dispose of, or encumber any direct or indirect interest in the Franchise Agreement, the Card My Yard business, or its assets without Card My Yard's prior written consent. Any attempt to do so without consent is considered a material breach of the agreement and will be void.
If a franchisee wishes to transfer any interest in the Card My Yard business or the agreement, they must apply to Card My Yard for consent. Card My Yard will not unreasonably withhold consent but may require certain conditions, including satisfaction of all accrued monetary obligations, compliance with all agreements, and payment of a transfer fee. The transfer fee is the greater of $3,000 or 5% of the sale/transfer price. Additionally, the transferee may be required to sign Card My Yard's then-current Franchise Agreement and other related documents.