After termination or expiration of the Floyds 99 Development Agreement, what must the developer do regarding their development activities?
Floyds_99 Franchise · 2025 FDDAnswer from 2025 FDD Document
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.
Source: Item 23 — RECEIPT (FDD pages 58–229)
What This Means (2025 FDD)
According to Floyds 99's 2025 Franchise Disclosure Document, upon termination or expiration of the Development Agreement, the developer's rights to develop Floyds 99 shops automatically terminate, and they must immediately cease all development activities. Floyds 99 has no further obligation to grant additional franchises to the developer, and Floyds 99 is free to establish and operate, or grant others the right to establish and operate, Floyds 99 shops within the former development area.
Furthermore, the developer must immediately stop using Floyds 99's marks, confidential information, slogans, trademarks, trade names, service marks, designs, trade dress, or logos. This extends to any similar equipment, materials, forms, methods, procedures, recipes, and techniques associated with the Floyds 99 system. The only exception is for barbershops the developer is currently operating under effective Franchise Agreements or for which a Franchise Agreement was signed before the termination or expiration date.
The developer must also adhere to all restrictive covenants outlined in the Development Agreement. All obligations of both Floyds 99 and the developer (including the developer's owners) that are meant to survive the termination or expiration of the agreement will remain in effect until they are fully satisfied or naturally expire. However, if any terms regarding termination or expiration in the agreement are inconsistent with applicable state or federal law, those laws will take precedence in governing the developer's rights.