Does the parent company of Card My Yard guarantee the franchisor's obligations to franchisees?
Card_My_Yard Franchise · 2025 FDDAnswer from 2025 FDD Document
Our Parent, Predecessor and affiliates do not guarantee any of our obligations to you and do not commit to performing any of our pre-sale or post-sale obligations.
Source: Item 1 — THE FRANCHISOR, AND ANY PARENTS, PREDECESSORS AND AFFILIATES (FDD pages 9–13)
What This Means (2025 FDD)
According to Card My Yard's 2025 Franchise Disclosure Document, the parent company, CMY Holdco, LLC, does not guarantee the franchisor's obligations to franchisees. This means that if CMY Franchising, LLC, the franchisor, fails to meet its contractual obligations to you as a franchisee, you cannot seek recourse from its parent company, CMY Holdco, LLC, for those unmet obligations. This also applies to Card My Yard's Predecessor and affiliates.
This lack of guarantee can be a significant risk for potential franchisees. Typically, a parent company guarantee provides an added layer of financial security, assuring franchisees that the parent company stands behind the franchisor's commitments. Without this guarantee, franchisees are more vulnerable if the franchisor experiences financial difficulties or fails to uphold its responsibilities.
Prospective franchisees should carefully consider this aspect and conduct thorough due diligence on the financial stability and reputation of CMY Franchising, LLC. It would be prudent to seek legal and financial advice to fully understand the implications of the absence of a parent company guarantee before investing in a Card My Yard franchise.