What is the Floyds 99 franchisee's obligation regarding the lease term?
Floyds_99 Franchise · 2025 FDDAnswer from 2025 FDD Document
itten approval before executing any lease, including all lease amendments, for the Franchised Location. If the Franchisee is purchasing real property for the Franchised Location, the Franchisee shall obtain the Franchisor's prior written approval of the purchase agreement before it is signed. The lease for the Franchised Location shall contain provisions set forth in detail in the Operations Manual (defined in Section 8.1 below), which may include the following: (1) providing for an initial term, or an initial term together with any renewal terms (for which rent must be specified in the lease) of at least 10 years; (2) expressing the landlord's consent to the Franchisee's use of the Marks and all required signage for the Barbershop; (3) giving the Franchisor the right to enter the premises and make any modification necessary to protect the Marks and the Licensed Methods; (4) allowing the Franchisor, or its designee, to have the option to assume the lease and the right following such assumption to assign the lease or sublet the leased premises to another FLOYD'S 99 franchisee for all or any part of the lease term without further landlord consent if the Franchisee defaults under the lease or this Agreement or if this Agreement terminates or expires; (5) requiring the landlord to give the Franchisor written notice of any defaults by the Franchisee under such lease and the right to cure any such defaults; and (6) the lease shall also contain restrictive use clauses which are acceptable to the Franchisor. The Franchisor reserves the right to require the Franchisee to use the Franchisor's standard form of lease instead of adding the required provisions to the landlord's form of lease, in the Franchisor's sole discretion. The lease shall be conditionally assigned to the Franchisor as security for the Franchisee's timely performance of all obligations under this Agreement and the lease. The Franchisee shall enter into Franchisor's standard Conditional Assignment of Lease. In addition, the Franchisee shall obtain the landlord's consent to the terms of the Franchisor's standard form of Lease Addendum or incorporate the Franchisor's required terms into the lease or obtain the landlord's consent to the terms of the Franchisor's standard form of lease, whichever is applicable.
Source: Item 22 — CONTRACTS (FDD pages 57–58)
What This Means (2025 FDD)
According to the 2025 FDD, a Floyds 99 franchisee must secure a lease that includes an initial term, or an initial term combined with any renewal terms, totaling at least 10 years. The lease terms must be approved by Floyds 99. This ensures the franchisee has a stable location for a significant period, allowing them to build a customer base and establish their business.
In addition to the minimum term, the lease must also express the landlord's consent to the franchisee's use of Floyds 99's trademarks and required signage. It must grant Floyds 99 the right to enter the premises to make modifications necessary to protect its marks and licensed methods. Furthermore, the lease should allow Floyds 99, or its designee, the option to assume the lease and the right to assign or sublet the premises to another franchisee without further landlord consent if the franchisee defaults or the agreement terminates. The landlord must also provide Floyds 99 with written notice of any franchisee defaults and the right to cure those defaults. Finally, the lease must contain restrictive use clauses acceptable to Floyds 99.
Floyds 99 also requires the lease to be conditionally assigned to them as security for the franchisee's performance under the Franchise Agreement and the lease itself. The franchisee must also enter into Floyds 99's standard Conditional Assignment of Lease. Floyds 99 may also require the franchisee to use their standard lease form instead of adding provisions to the landlord's form. These stipulations protect Floyds 99's interests and ensure consistency across all franchised locations. The franchisee must obtain Floyds 99's prior written approval before executing any lease, including all amendments, and must provide a copy of the signed lease to Floyds 99 within 15 days of execution. The franchisee has 270 days from the date of the Franchise Agreement to sign a lease for the Franchised Location.