What is Dermani Medspa authorized to do with special or restrictive legends on checks?
Dermani_Medspa Franchise · 2025 FDDAnswer from 2025 FDD Document
- 5.4. Governing Documents. If you are a corporation, partnership, LLC, or LLP, or transfer this Agreement to a corporation, partnership, LLC, or LLP, then, upon our request, you must provide to us a list of holders of direct or indirect equity interests and their percentage interests, as well as copies of your governing documents and any other corporate documents, books, or records. The Owners may not enter into any shareholders' agreement, management agreement, voting trust or other arrangement that gives a third party the power to direct and control your affairs without our prior written consent. Throughout the Term of this Agreement, your governing documents (and those of your ultimate parent) must provide that no transfer of any ownership interest may be made except in accordance with Section 7 of this Agreement and Section 12 of the Franchise Agreement. Any securities that you issue must bear a conspicuous printed legend to that effect.
Source: Item 23 — RECEIPTS (FDD pages 66–311)
What This Means (2025 FDD)
According to the 2025 Dermani Medspa FDD, if a franchisee is a corporation, partnership, LLC, or LLP, or transfers the agreement to one of those entities, Dermani Medspa can request a list of equity interest holders and their percentage interests, as well as copies of governing documents. The owners cannot enter into agreements that give a third party control over their affairs without Dermani Medspa's written consent.
The Dermani Medspa FDD stipulates that the franchisee's governing documents (and those of their ultimate parent company, if applicable) must state that no ownership interest can be transferred except as outlined in Section 7 of the agreement and Section 12 of the Franchise Agreement.
Furthermore, any securities issued by the franchisee must include a conspicuous printed legend to that effect. This means Dermani Medspa requires that any stock certificates or other documents representing ownership in the franchisee's business must clearly state that the transfer of ownership is restricted and subject to the terms of the franchise agreement. This provision ensures that Dermani Medspa maintains control over who becomes a franchisee and that transfers of ownership comply with the franchise agreement's requirements.