Does the Card My Yard general release apply to the franchisee's shareholders?
Card_My_Yard Franchise · 2025 FDDAnswer from 2025 FDD Document
[Item 23: RECEIPTS]
- (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;
[Item 23: RECEIPTS]
- (7) You and your Owners must execute a general release of any and all claims against us, our Affiliates, and 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 or under federal, state or local laws, rules, 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, a general release is required from the transferor and its owners when transferring a franchise. This release, in a form satisfactory to Card My Yard, covers any and all claims against Card My Yard, its affiliates, and their respective officers, directors, shareholders, partners, members, agents, representatives, independent contractors, servants, and employees, both past and present, in their corporate and individual capacities. The claims include, but are not limited to, those arising under the Franchise Agreement, any other agreement with Card My Yard or its affiliates, and under federal, state, or local laws, rules, and regulations or orders.
This requirement means that if a franchisee wishes to transfer their Card My Yard franchise, the franchisee and their owners (which would include shareholders if the franchisee is a corporation) must sign a general release, absolving Card My Yard from any potential legal claims. This is a standard practice in franchising to prevent future litigation from the transferring party.
Additionally, when renewing a franchise agreement with Card My Yard, the franchisee and their owners must execute a general release of any and all claims against Card My Yard, its affiliates, and their respective officers, directors, shareholders, partners, members, agents, representatives, independent contractors, servants and employees, past and present, in their corporate and individual capacities. The claims include, without limitation, claims arising under the Franchise Agreement or under federal, state or local laws, rules, regulations or orders.
In summary, Card My Yard requires a comprehensive general release from both the franchisee and their owners (including shareholders) during franchise transfer and renewal, protecting the franchisor from potential legal liabilities. Prospective franchisees should carefully review this requirement with legal counsel to understand its implications fully.