What is the impact of an earthquake on the operation of a Floyds 99 shop regarding termination?
Floyds_99 Franchise · 2025 FDDAnswer from 2025 FDD Document
- 20.1 Termination by Franchisor Effective Upon Notice. The Franchisor shall have the right, at its option, to terminate this Agreement and all rights granted the Franchisee hereunder, without affording the Franchisee any opportunity to cure any default (subject to any state laws to the contrary, where state law shall prevail), effective upon written notice to the Franchisee, addressed as provided in Section 24.12 upon the occurrence of any of the following events:
- a. Abandonment. If the Franchisee ceases to operate the FLOYD'S 99 Shop or otherwise abandons the FLOYD'S 99 Shop for a period of three consecutive days, or any shorter period that indicates an intent by the Franchisee to discontinue operation of the FLOYD'S 99 Shop, unless and only to the extent that full operation of the FLOYD'S 99 Shop is suspended or terminated due to fire, flood, earthquake or other similar causes beyond the Franchisee's control and not related to the availability of funds to the Franchisee;
Source: Item 22 — CONTRACTS (FDD pages 57–58)
What This Means (2025 FDD)
According to Floyds 99's 2025 Franchise Disclosure Document, an earthquake can impact the termination of a franchise agreement. Specifically, if a Floyds 99 shop ceases operations due to an earthquake or other similar causes beyond the franchisee's control, this may not be considered abandonment of the shop.
Under normal circumstances, if a franchisee ceases to operate the Floyds 99 shop for three consecutive days, the franchisor has the right to terminate the agreement. However, this abandonment clause is waived if the shop's full operation is suspended or terminated due to an earthquake or other similar causes beyond the franchisee's control. The exception is made only when the cause is not related to the availability of funds to the franchisee.
This provision protects the franchisee from immediate termination in the event of a natural disaster that forces the temporary closure of the Floyds 99 shop, provided the closure isn't due to financial issues. It is important to note that this protection applies only to the abandonment clause and not necessarily to other potential grounds for termination that may arise from the impact of the earthquake.