Which obligations of the Floyds 99 Franchisor and Developer survive the expiration or termination of the Development Agreement?
Floyds_99 Franchise · 2025 FDDAnswer from 2025 FDD Document
day period, Developer shall be given an additional reasonable period of time to cure the breach, and this Agreement shall not automatically terminate without written notice from Franchisor.
9.3 Rights and Obligations of Developer Upon Termination or Expiration.
- (a) Loss of Development Rights. Upon termination or expiration of this Agreement for any reason, the development rights granted to Developer under this Agreement will automatically terminate and Developer agrees to immediately and permanently cease its development activities. Franchisor will then have no further obligation to grant Developer additional franchises for FLOYD'S 99 Shops and Franchisor will be free to establish and operate, and grant other persons franchises to establish and operate, FLOYD'S 99 Shops within the former Development Area.
- (b) Marks and Confidential Information. Except in connection with Barbershops Developer is then operating under effective Franchise Agreements with Franchisor, or with respect to which a Franchise Agreement has been signed prior to the date of expiration or termination of this Agreement, Developer agrees to immediately and permanently cease to use, by advertising or in any manner whatsoever, the Marks and Confidential Information; slogans, trademarks, trade names, service marks, designs, trade dress or logos which are similar in nature to the Marks; or any equipment, materials, forms, confidential methods, procedures, recipes and techniques associated with or similar to the FLOYD'S 99 system or which display the Marks or any other distinctive forms, slogans, signs, symbols, trade dress or devices associated with or belonging to Franchisor or its affiliates.
- (c) Restrictive Covenants. Abide by all restrictive covenants set forth in this Agreement.
- (d) Continuing Obligations. All of Franchisor's and Developer's (and Developer's owners) obligations under this Agreement which expressly or by their nature survive the expiration or termination of this Agreement will continue in full force and effect subsequent to and notwithstanding the expiration or termination of this Agreement, until they are satisfied in full or by their nature expire.
- 9.4 State and Federal Law. THE PARTIES ACKNOWLEDGE THAT IN THE EVENT THAT THE TERMS OF THIS AGREEMENT REGARDING TERMINATION OR EXPIRATION ARE INCONSISTENT WITH APPLICABLE STATE OR FEDERAL LAW, SUCH LAW SHALL GOVERN DEVELOPER'S RIGHTS REGARDING TERMINATION OR EXPIRATION OF THIS AGREEMENT.
10. BUSINESS RELATIONSHIP
- 10.1 Independent Businesspersons. The parties acknowledge that each of them is an independent businessperson, that their only relationship is by virtue of this Agreement and that no fiduciary relationship is created hereunder. Neither party is liable or responsible for the other's debts or obligations, nor shall either party be obligated for any damages to any person or property directly or indirectly arising out of the operation of the other party's business authorized by or conducted pursuant to this Agreement.
Source: Item 23 — RECEIPT (FDD pages 58–229)
What This Means (2025 FDD)
According to the 2025 Floyds 99 Franchise Disclosure Document, several obligations of both the franchisor and the developer survive the expiration or termination of the Development Agreement. These include abiding by all restrictive covenants outlined in the agreement. Additionally, any obligations that, by their nature or express terms, are meant to continue after the agreement's end will remain in effect until fully satisfied or naturally expired.
Floyds 99 also requires the developer to indemnify, defend, and hold harmless the franchisor and its affiliates against any claims, damages, or legal actions arising from the developer's activities or failures to act under the agreement, even after termination. This indemnification covers all costs, including attorney's fees and litigation expenses. This obligation remains in full force and effect even after the agreement expires or is terminated.
Specifically, the developer must cease using Floyds 99's marks and confidential information upon termination or expiration, except concerning barbershops the developer continues to operate under existing Franchise Agreements. This includes trademarks, trade names, service marks, designs, trade dress, logos, and any confidential methods or techniques associated with the Floyds 99 system. This ensures that the developer cannot leverage the franchisor's brand and proprietary information after the agreement ends, protecting the Floyds 99 system's integrity and value.