Under what conditions might Floyds 99 exercise its step-in management right?
Floyds_99 Franchise · 2025 FDDAnswer from 2025 FDD Document
| Step In Management Fee1 | Currently 5% of Gross Sales plus expenses | As incurred if we exercise our step in management right | We may step in and manage your FLOYD'S 99 Shop (a) if you are in default and your FLOYD'S 99 Shop is not being operated or managed properly, or if your FLOYD'S 99 Shop is not being operated by a trained Principal Manager, (b) if you are absent or incapacitated by reason of illness or debt, (c) if you fail to pay when due or remove any liens or encumbrances on your FLOYD'S 99 Shop, or (d) if necessary to ensure continued operations as a going concern and to correct operational issues. We only charge a management fee if we manage your FLOYD'S 99 Shop (you must also reimburse us for the expenses, debts and liabilities we | | Type of Fee | Amount | Due Date | Remarks | |---------------------|--------------------------------------------------------------------|--------------------------------------------------------------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------| | | | | incur to manage your FLOYD'S 99 Shop). |
Source: Item 6 — OTHER FEES (FDD pages 14–20)
What This Means (2025 FDD)
According to Floyds 99's 2025 Franchise Disclosure Document, Floyds 99 has the right to step in and manage a franchisee's shop under specific circumstances. These include situations where the franchisee is in default and the shop isn't being properly managed or operated, or if a trained Principal Manager is not running the shop. Floyds 99 can also step in if the franchisee is absent or incapacitated due to illness or debt.
Additionally, Floyds 99 may exercise its step-in rights if the franchisee fails to pay or removes any liens or encumbrances on the shop. This provision is likely in place to protect the brand's reputation and ensure the financial stability of the franchise network. Another condition that allows Floyds 99 to step in is if it's necessary to ensure the continued operation of the shop as a going concern and to correct operational issues.
If Floyds 99 does step in to manage a shop, the franchisee will be responsible for a Step In Management Fee. This fee is currently 5% of Gross Sales, plus any expenses Floyds 99 incurs while managing the shop. This fee structure incentivizes franchisees to maintain proper management and address any issues promptly to avoid intervention from Floyds 99.