Does Floyds 99 require 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 lease for the franchised location must contain restrictive use clauses that are acceptable to Floyds 99. This means that the lease agreement must include specific limitations on how the property can be used by the tenant (the franchisee) and potentially other tenants in the same building or shopping center. Floyds 99 needs to approve these clauses.
For a prospective Floyds 99 franchisee, this requirement means they will need to ensure that the lease agreement they negotiate with the landlord includes these restrictive use clauses and that Floyds 99 finds them acceptable. This could potentially limit the franchisee's flexibility in using the premises for other purposes or subletting to businesses that Floyds 99 deems competitive. It also gives Floyds 99 a degree of control over the types of businesses that operate near the franchised location, which could impact customer traffic and the overall brand image.
This type of requirement is relatively common in franchising, as franchisors often want to protect their brand and prevent competition near their franchisees' locations. The franchisee should carefully review the lease agreement and ensure they understand the implications of these restrictive use clauses before signing. They should also work closely with Floyds 99 during the lease negotiation process to ensure that the clauses are acceptable to both parties.