Are the owners of a Clean Your Dirty Face franchise allowed to have other business interests?
Clean_Your_Dirty_Face Franchise · 2025 FDDAnswer from 2025 FDD Document
You therefore agree that, during this Agreement's term, neither you, any of your owners, nor any of your or your owners' immediate family members will:
- have any direct or indirect controlling or non-controlling ownership interest (a) (whether of record, beneficially, or otherwise) in a Competitive Business (as defined below), wherever located or operating (except that equity ownership of less than five percent (5%) of a Competitive Business whose stock or other forms of ownership interest are publicly traded on a recognized United States stock exchange will not be deemed to violate this subparagraph);
- perform services as a director, officer, manager, independent contractor, employee, consultant, lessor, representative, or agent for a Competitive Business, wherever located or operating;
- divert or attempt to divert any actual or potential business or customer of your Business to a Competitive Business; or
- (d) engage in any other activity which might injure the goodwill of any Marks or the Franchise System.
We may require your directors and officers who have not executed a guaranty in the form attached as Exhibit D hereto, to execute a Confidentiality and Non-Competition Agreement in the form that we designate (the current form of which is attached hereto as Exhibit C).
Source: Item 22 — CONTRACTS (FDD page 54)
What This Means (2025 FDD)
According to Clean Your Dirty Face's 2025 Franchise Disclosure Document, franchisees and their owners are significantly restricted from having other business interests, specifically those that compete with Clean Your Dirty Face. During the term of the franchise agreement, franchisees, their owners, and their immediate family members are prohibited from having a direct or indirect ownership interest in a Competitive Business. A Competitive Business is defined as any business offering facials and/or other skincare services, excluding other Clean Your Dirty Face locations.
This restriction includes owning any amount of a competing business, whether controlling or non-controlling. However, there is an exception: owning less than 5% of a publicly traded Competitive Business on a recognized United States stock exchange is permitted. Franchisees and related parties are also prohibited from working for a Competitive Business in any capacity, including as a director, officer, manager, independent contractor, employee, consultant, lessor, representative, or agent.
Furthermore, franchisees must not divert or attempt to divert any business or customers from their Clean Your Dirty Face franchise to a Competitive Business. They are also barred from engaging in any activity that might harm the goodwill of the Clean Your Dirty Face brand or the franchise system. Clean Your Dirty Face may also require directors and officers to sign a Confidentiality and Non-Competition Agreement.