Is the Floyds 99 Franchisor responsible for the Developer's obligations to third parties?
Floyds_99 Franchise · 2025 FDDAnswer from 2025 FDD Document
Franchisor shall have no liability for Developer's obligations to pay any third parties, including without limitation, banks, other lenders, government agencies, any product vendors, or any sales, use, service, occupation, excise, gross receipts, income, property or other tax levied upon Developer, Developer's property, the FLOYD'S 99 Shop(s) developed
under this Agreement or upon Franchisor in connection with the sales made or business conducted by Developer (except any taxes Franchisor is required by law to collect from Developer with respect to purchases from Franchisor).
Source: Item 23 — RECEIPT (FDD pages 58–229)
What This Means (2025 FDD)
According to the 2025 Floyds 99 Franchise Disclosure Document, Floyds 99 is not liable for the Developer's obligations to third parties. The agreement explicitly states that the relationship between Floyds 99 and the Developer is that of independent businesspersons, with no fiduciary relationship created. This means neither party is responsible for the debts or obligations of the other.
Specifically, Floyds 99 has no liability for the Developer's obligations to pay third parties. These third parties include banks, lenders, government agencies, product vendors, or any taxes levied upon the Developer, the Developer's property, or the Floyds 99 shop developed under the agreement. The only exception is for taxes that Floyds 99 is legally required to collect from the Developer related to purchases from Floyds 99.
This arrangement is typical in franchising, where franchisees and developers operate as independent entities. Prospective Floyds 99 developers should understand that they are solely responsible for their financial obligations and should conduct their business accordingly. This includes securing their own financing, managing their tax responsibilities, and fulfilling their contractual obligations with vendors and other service providers.