What specific actions related to insolvency can lead to termination of the Floyds 99 Franchise Agreement?

According to the 2025 Floyds 99 Franchise Disclosure Document, Floyds 99 can terminate the franchise agreement if the franchisee becomes insolvent or is adjudicated bankrupt. Additionally, if any action is taken by the franchisee or others against the franchisee under any insolvency, bankruptcy, or reorganization act, Floyds 99 has grounds for termination. The FDD notes that this particular provision may not be enforceable under federal bankruptcy law.

Furthermore, if the franchisee makes an assignment for the benefit of creditors or a receiver is appointed by the franchisee, Floyds 99 can terminate the agreement. This means that if a franchisee voluntarily assigns their assets to a third party to benefit their creditors, or if a receiver is appointed to manage the franchisee's assets due to financial distress, Floyds 99 has the right to terminate the franchise agreement.

These terms are fairly standard in franchising, as franchisors want to protect their brand and ensure franchisees are financially stable. Insolvency or bankruptcy can significantly impact a franchisee's ability to operate the business according to Floyds 99's standards, potentially harming the brand's reputation. Prospective franchisees should carefully consider these terms and ensure they have a solid financial plan to avoid such situations.