What happens if a Floyds 99 developer defaults under other agreements?
Floyds_99 Franchise · 2025 FDDAnswer from 2025 FDD Document
| h. | "Cause" defined – non-curable defaults | Section 9.1 | Material misrepresentation, failure to meet development schedule, conviction of a crime, failure to pay amounts due to Franchisor, unapproved transfers, misuse of Marks, death or disability of Developer, unauthorized disclosure, noncompliance with restrictive covenants, terrorist activities, bankruptcy, assignment for benefit of creditors, default under Franchise | | | Provision | Section in Development Agreement | Summary | |----|------------------------------------------------------------------------------|----------------------------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------| | | | | Agreement or other agreements, notice of termination of Franchise Agreement delivered to Developer by Franchisor or Developer terminates a Franchise Agreement without cause. | | i. | Franchisee's obligations on termination / nonrenewal | Section 9.3 | Loss of development rights, cease use of Marks and confidential information except in connection with Barbershops currently operating; covenant not to compete.
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 44–49)
What This Means (2025 FDD)
According to Floyds 99's 2025 Franchise Disclosure Document, a developer's default under other agreements can lead to termination of the Development Agreement. Specifically, if a developer fails to meet their obligations under any Franchise Agreement or other agreements with Floyds 99, this is considered a non-curable default.
This means Floyds 99 has the right to terminate the Development Agreement. The termination can occur if a notice of termination of a Franchise Agreement is delivered to the developer by Floyds 99, or if the developer terminates a Franchise Agreement without cause.
Upon termination, the developer will lose their development rights and must cease using Floyds 99's marks and confidential information, except in connection with barbershops that are currently operating. Additionally, the developer will be subject to a covenant not to compete, preventing them from engaging in a competing business for a specified period and within a certain geographic radius of Floyds 99 shops.