During the term of the Floyds 99 Development Agreement, who must own and control the Floyd's 99 developer business?
Floyds_99 Franchise · 2025 FDDAnswer from 2025 FDD Document
- 3.2 Ownership of Business. Developer shall at all times during the term of this Agreement own and control the FLOYD'S 99 developer business authorized hereunder. Upon request of Franchisor, Developer shall promptly provide satisfactory proof of such ownership and control to Franchisor. Developer represents that the Statement of Ownership, attached hereto as Exhibit III and by this reference
incorporated herein, is true, complete, accurate and not misleading, and, in accordance with the information contained in the Statement of Ownership, the controlling ownership of the FLOYD'S 99 developer business is held by Developer. Developer shall promptly provide Franchisor with a written notification if the information contained in the Statement of Ownership changes at any time during the term of this Agreement and shall comply with the applicable transfer provisions contained in Article 8 herein and in the Franchise Agreement. In addition, if Developer is an entity, all of the owners of Developer shall sign the Guaranty and Assumption of Developer's Obligations attached hereto as Exhibit II.
Source: Item 23 — RECEIPT (FDD pages 58–229)
What This Means (2025 FDD)
According to Floyds 99's 2025 Franchise Disclosure Document, the developer is required to maintain ownership and control of the Floyds 99 developer business throughout the term of the Development Agreement. Floyds 99 may request proof of this ownership and control from the developer. The developer must also ensure that the Statement of Ownership provided to Floyds 99 is accurate and up-to-date. Any changes to the ownership information must be promptly reported to Floyds 99 in writing, and the developer must comply with the transfer provisions outlined in the Development Agreement and Franchise Agreement.
This requirement ensures that the individual or entity initially approved by Floyds 99 remains in charge of developing the franchise locations. This is a common practice in franchising, as the franchisor wants to ensure that the developer is committed to the brand and has the necessary expertise to expand the franchise network effectively.
Furthermore, if the developer is a business entity, all owners of the entity must sign a Guaranty and Assumption of Developer's Obligations, demonstrating their personal commitment to fulfilling the Development Agreement. This provides Floyds 99 with an additional layer of security and accountability. Failure to maintain ownership and control, or to properly report changes in ownership, could potentially lead to a breach of the Development Agreement.