Are there any state law exceptions to the Card My Yard franchisee's termination rights?
Card_My_Yard Franchise · 2025 FDDAnswer from 2025 FDD Document
| Provision | Section in Franchise Agreement | Summary |
|---|---|---|
| a. Length of the franchise term | Section IV.A | Five (5) year initial term. |
| b. Renewal or extension of the term | Section IV.B | Three additional 5-year terms. |
| c. Requirements for franchisee to renew or extend | Section IV.B | Your renewal right permits you to remain as a franchisee after the initial term of your franchise agreement expires. However, to remain a franchisee, you must meet all required conditions to renewal, including signing our then-current Franchise Agreement, which may contain materially different terms and conditions and different territory boundaries from your original contract, except that the fees on renewal will not be greater than the fees that we then impose on similarly situated renewing franchisees. |
| Other | ||
| requirements | ||
| are: | ||
| Give written notice; update required items; | ||
| not | ||
| be | ||
| in | ||
| default; | ||
| pay | ||
| all | ||
| money | ||
| owed; | ||
| retain | ||
| right to Location; pay us a renewal fee; sign | ||
| general release; comply with then-current | ||
| qualifications and training requirements. |
| d. Termination by franchisee | Not Applicable | Not Applicable (your termination rights are subject to state law) |
Source: Item 17 — RENEWAL TERMINATION TRANSFER AND DISPUTE RESOLUTION THE FRANCHISE RELATIONSHIP (FDD pages 51–55)
What This Means (2025 FDD)
According to Card My Yard's 2025 Franchise Disclosure Document, a franchisee's termination rights are subject to state law. This means that the specific rights a Card My Yard franchisee has to terminate their franchise agreement can vary depending on the state in which they operate.
This is a fairly standard practice in franchising, as state laws often govern the franchise relationship to protect franchisees. These laws can dictate the circumstances under which a franchisee can terminate the agreement, any notice requirements, and potential penalties or obligations upon termination.
Prospective Card My Yard franchisees should carefully investigate the franchise laws in their specific state to understand their rights and obligations regarding termination. It would be prudent to seek legal counsel to fully understand how state laws might impact their ability to terminate the franchise agreement and what the potential consequences might be. This due diligence is essential to making an informed decision about investing in a Card My Yard franchise.