In Washington, when must Card My Yard defer payment of the initial franchise fee from franchisees?
Card_My_Yard Franchise · 2025 FDDAnswer from 2025 FDD Document
-
- The following statements are added to Item 5:
Pursuant to RCW 19.100.050 and WAC 460-80-400, the Securities Division of the Washington Department of Financial Institutions requires us to defer payment of the initial franchise fee and other initial payments owed by franchisees until we have completed our pre-opening obligations under the applicable franchise agreement and other documents and you have commenced operation of your franchised business pursuant to the franchise agreement.
Source: Item 23 — RECEIPTS (FDD pages 84–259)
What This Means (2025 FDD)
According to Card My Yard's 2025 Franchise Disclosure Document, the Securities Division of the Washington Department of Financial Institutions mandates that Card My Yard must defer the payment of the initial franchise fee and other initial payments from franchisees in Washington. This deferral is required until Card My Yard has fulfilled all its pre-opening obligations as outlined in the franchise agreement and related documents. Additionally, the franchisee must have commenced operations of their Card My Yard business according to the franchise agreement.
This regulation protects prospective Card My Yard franchisees by ensuring that they do not pay the initial franchise fee before Card My Yard has provided the necessary support and fulfilled its obligations to help them start their business. It aligns the payment of the fee with the franchisee's ability to begin generating revenue.
This requirement is specific to Washington State due to its franchise investment protection laws. Prospective franchisees in Washington should ensure they understand these protections and confirm that Card My Yard is adhering to these regulations. This deferral provides a level of financial security, ensuring that franchisees only pay the initial fee once they are ready to start their Card My Yard business.