What is a 'Management Agreement' in the context of a C3 Wellness Spa Spa Management Business?
C3_Wellness_Spa Franchise · 2024 FDDAnswer from 2024 FDD Document
a; or
Spa Management Business – Your development and operation of a Spa Location Franchise that owns and operates a management business ("Spa Management Business") that provides management, marketing, and spa facility based services (the "Spa Facility and Management Services") to medical practices, professional corporations, and licensed professionals authorized to offer and provide the Approved Spa Products and Services (referred to as "Authorized Care Providers") at a Spa that is directly operated, and potentially owned, by the Authorized Care Providers authorized to directly offer and provide the Approved Spa Products and Services. You will enter into a management agreement ("Management Agreement") with the Authorized Care Providers to provide them with the Spa Facility and Management Services and grant them a license to use the Licensed Marks at the location of your
Spa Location Franchise. If your Spa Location Franchise operates as a Spa Management Business, the gross sales and revenues of your Spa Location Franchise will be generated from management and other fees paid by Authorized Care Providers for Spa Facility and Management Services. Although your Management Agreement must be approved by us and although we provide a sample management agreement (Franchise Agreement, Exhibit 10), you must directly hire your own attorney to independently evaluate, review, and ensure that your Management Agreement complies with all applicable laws, rules and regulations. The Spa Management Business is only offered to franchisees who are not licensed medical professionals.
Spas shall offer and provide the Approved Spa Products and Services and shall include and use those products, supplies and equipment including, cosmetic injectables and fillers and specialized equipment and supplies for treatments involving skin care and body sculpting designated by us (collectively, the "System Supplies") and shall be managed using the point of sale and business management systems (collectively, the "Business Management System") designated by us.
Source: Item 1 — THE FRANCHISOR AND ANY PARENTS, PREDECESSORS AND AFFILIATES (FDD pages 8–14)
What This Means (2024 FDD)
According to C3 Wellness Spa's 2024 Franchise Disclosure Document, a 'Management Agreement' is a contract that a franchisee operating a Spa Management Business enters into with Authorized Care Providers. These providers are medical practices, professional corporations, and licensed professionals authorized to offer Approved Spa Products and Services. Through this agreement, the C3 Wellness Spa franchisee provides Spa Facility and Management Services to these Authorized Care Providers, and also grants them a license to use the Licensed Marks at their location. The gross sales and revenues of the Spa Location Franchise are generated from management and other fees paid by Authorized Care Providers for these services.
C3 Wellness Spa requires that the Management Agreement be approved by them, and they provide a sample agreement as Exhibit 10 in the Franchise Agreement. However, the document emphasizes that franchisees must hire their own attorney to independently evaluate, review, and ensure that their Management Agreement complies with all applicable laws, rules, and regulations. This is particularly important because the Spa Management Business is only offered to franchisees who are not licensed medical professionals.
These agreements are vital to compliance, as the operations of the Spa Location Franchise need to follow and adhere to the standard operating procedures as written. The Management Agreement also addresses flow of funds concerns, especially if operating as a Spa Management Business, as funds need to follow a specific route from professionals to lay persons. It is critical to determine state law for which Authorized Care Provider can conduct a primary patient evaluation and diagnosis, develop the treatment plan, as well as who can perform the procedure.
Prospective franchisees should carefully review the sample Management Agreement provided by C3 Wellness Spa and consult with legal counsel to ensure it meets all legal requirements and adequately protects their interests. Understanding the specifics of this agreement is crucial for the successful operation of a Spa Management Business under the C3 Wellness Spa franchise system.