What is the Floyds 99 franchisee's obligation regarding restrictive use clauses in the lease?
Floyds_99 Franchise · 2025 FDDAnswer from 2025 FDD Document
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.
Source: Item 22 — CONTRACTS (FDD pages 57–58)
What This Means (2025 FDD)
According to the 2025 Floyds 99 Franchise Disclosure Document, the franchisee's lease for the franchised location must contain restrictive use clauses that are acceptable to Floyds 99. This means that the franchisee must ensure that the lease agreement includes terms that limit how the landlord and other tenants in the same property can use their premises, so that their activities do not negatively impact the Floyds 99 business.
In practical terms, this requirement protects Floyds 99 from direct competition or other businesses that could detract from the brand's image or customer experience. For example, the restrictive use clauses might prevent the landlord from leasing space to another barbershop or a business that sells similar hair care products. The franchisee is responsible for negotiating these clauses with the landlord and ensuring that they meet Floyds 99's approval.
This obligation is significant because it places the onus on the franchisee to secure lease terms that benefit Floyds 99. If the franchisee fails to include acceptable restrictive use clauses, Floyds 99 could disapprove the lease, potentially delaying or preventing the opening of the franchise. Therefore, prospective franchisees should carefully review Floyds 99's requirements for restrictive use clauses and seek legal counsel to ensure compliance during lease negotiations.