What activities are prohibited by the Dermani Medspa covenant not to compete?
Dermani_Medspa Franchise · 2025 FDDAnswer from 2025 FDD Document
(b) Member covenants and agrees that during the term of the Area Development Agreement, except as otherwise approved in writing by Franchisor, Member will not, either directly or indirectly, for him or herself, or through, on behalf of, or in conjunction with any person, persons, partnership, corporation, or entity:
(i) develop, build, own, maintain, operate, manage, engage in, franchise, or license, or have any direct or indirect controlling or non-controlling interest as an owner – whether of record, beneficially, or otherwise – in medical spa centers or businesses that offer medical spa products or services substantially similar to those then offered by dermani MEDSPA®s ("Competitive Business");
(ii) be or perform services as a director, officer, manager, employee, consultant, representative, or agent for a Competitive Business, wherever located or operating;
(iii) divert or attempt to divert any actual or potential business or customer of the Franchised Business to a Competitive Business; or
(iv) In any manner interfere with, disturb, disrupt, impair, diminish, or otherwise jeopardize our business or that of our affiliates or any of our developers or franchisees.
Source: Item 23 — RECEIPTS (FDD pages 66–311)
What This Means (2025 FDD)
According to the 2025 Dermani Medspa FDD, during the term of the Area Development Agreement, a member is restricted from engaging in several activities related to competitive businesses, unless explicitly approved in writing by Dermani Medspa. These restrictions apply directly or indirectly, whether for themselves or in conjunction with others.
The prohibited activities include developing, building, owning, maintaining, operating, managing, engaging in, franchising, or licensing any medical spa centers or businesses that offer products or services substantially similar to those offered by Dermani Medspa. This encompasses any direct or indirect controlling or non-controlling ownership interest. Furthermore, a member cannot serve as a director, officer, manager, employee, consultant, representative, or agent for a Competitive Business, regardless of its location.
Additionally, members are prohibited from diverting or attempting to divert any actual or potential business or customer of the Franchised Business to a Competitive Business. They are also barred from interfering with, disturbing, disrupting, impairing, diminishing, or otherwise jeopardizing the business of Dermani Medspa, its affiliates, developers, or franchisees. These covenants aim to protect Dermani Medspa's business model, confidential information, and market position by preventing members from using their knowledge and resources to benefit competing businesses during their association with Dermani Medspa.