Under what conditions does Floyds 99 have the option to assume the lease and assign or sublet the premises?
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.
Source: Item 22 — CONTRACTS (FDD pages 57–58)
What This Means (2025 FDD)
According to Floyds 99's 2025 Franchise Disclosure Document, the company has the option to assume the lease and subsequently assign or sublet the leased premises to another Floyds 99 franchisee under specific circumstances. This right is triggered if the franchisee defaults under the lease agreement or the Franchise Agreement itself, or if the Franchise Agreement terminates or expires.
This provision is typically included in franchise agreements to protect the franchisor's brand and ensure continuity of operations. By securing the right to assume the lease, Floyds 99 can maintain control over the location and prevent a competitor from occupying the space. This clause also allows Floyds 99 to ensure another franchisee can take over the location, thus maintaining the brand's presence in that market.
For a prospective franchisee, this means that the lease agreement for their Floyds 99 shop must include a clause granting Floyds 99 this option. It also highlights the importance of complying with both the lease and the Franchise Agreement to avoid triggering this clause. The franchisee should carefully review the lease agreement and the Franchise Agreement to fully understand their obligations and the potential consequences of default or termination.