Under what conditions can Floyds 99 assume the lease of a Franchised Location?
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.
The Franchisor reserves the right to require the Franchisee to use the Franchisor's standard form of lease instead of adding the required provisions to the landlord's form of lease, in the Franchisor's sole discretion.
The lease shall be conditionally assigned to the Franchisor as security for the Franchisee's timely performance of all obligations under this Agreement and the lease.
The Franchisee shall enter into Franchisor's standard Conditional Assignment of Lease.
Source: Item 22 — CONTRACTS (FDD pages 57–58)
What This Means (2025 FDD)
According to the 2025 Floyds 99 Franchise Disclosure Document, Floyds 99 has the option to assume the lease of a franchised location if the franchisee defaults under the lease or the Franchise Agreement, or if the Franchise Agreement terminates or expires. In such cases, Floyds 99 also has the right to assign the lease or sublet the premises to another Floyds 99 franchisee without needing further consent from the landlord.
To protect these rights, Floyds 99 requires that specific provisions be included in the lease agreement for the franchised location. These provisions include giving Floyds 99 the right to enter the premises and make necessary modifications to protect their marks and licensed methods. The lease must also require the landlord to notify Floyds 99 of any defaults by the franchisee and allow Floyds 99 the right to cure those defaults. Additionally, the lease is conditionally assigned to Floyds 99 as security for the franchisee's performance of their obligations under the Franchise Agreement and the lease itself.
As a prospective franchisee, it is crucial to understand these lease requirements and ensure that the lease agreement for your Floyds 99 location includes all the necessary provisions to protect Floyds 99's interests. This also protects the franchisee by ensuring the franchisor has a vested interest in the location and its continued operation. The franchisee must obtain Floyds 99's prior written approval before executing any lease, including amendments, and must use Floyds 99's standard Conditional Assignment of Lease form. Floyds 99 also reserves the right to require the franchisee to use Floyds 99's standard form of lease.