What confidentiality provisions must be followed after the transfer of a Clean Your Dirty Face franchise?
Clean_Your_Dirty_Face Franchise · 2025 FDDAnswer from 2025 FDD Document
termination restrictive covenants, indemnification, dispute resolution, non-disparagement, confidentiality provisions, and the obligation to cease using any proprietary trademarks); (ii) any obligations arising prior to the Transfer Date (including any obligations to pay any amounts to Franchisor accruing prior to the Transfer Date); (iii) any failure to perform, improper performance, or other breach, default or violation by any Transferor Party of the Original Agreement; or (iv) any obligations of the Transferor Parties under this Consent. The Original Guaranty shall remain in force and effect and shall serve as a guaranty of the Surviving Obligations, and Transferor Guarantors acknowledge and agree that Franchisor may seek any available remedies against them for the failure of any Transferor Party to comply with any Surviving Obligations.
Source: Item 23 — RECEIPTS (FDD pages 54–186)
What This Means (2025 FDD)
According to Clean Your Dirty Face's 2025 Franchise Disclosure Document, the transferor remains obligated to uphold certain confidentiality provisions even after the franchise is transferred. Specifically, the original guarantor's obligations remain in effect, ensuring compliance with confidentiality and other stipulations. This means that even after a Clean Your Dirty Face franchise is sold to a new owner, the previous owner and their guarantors are still responsible for any breaches of confidentiality or other surviving obligations that may occur.
This condition protects Clean Your Dirty Face by ensuring that franchisees cannot simply transfer their business to avoid legal or financial responsibilities. The original franchise agreement remains relevant, particularly concerning aspects like confidentiality, which are crucial for maintaining the brand's integrity and competitive advantage. The franchisor can pursue remedies against the transferor if the new franchisee fails to meet these surviving obligations.
For a prospective Clean Your Dirty Face franchisee, this highlights the importance of understanding all aspects of the franchise agreement, including those that extend beyond the period of ownership. It also underscores the need to carefully vet potential buyers if the franchisee plans to sell their business, as the original owner remains liable for certain obligations even after the transfer is complete. This continuing liability could have significant financial and legal implications for the transferor.