What is the Dermani Medspa franchisee required to do with the Management Agreement?
Dermani_Medspa Franchise · 2025 FDDAnswer from 2025 FDD Document
e dermani MEDSPA®. In addition to signing the Franchise Agreement with us, before you begin operating the Franchised Business, you must enter into a management agreement ("Management Agreement") with the PC.
You must sign a Management Agreement with a PC unless your dermani MEDSPA® will be in a state that permits one entity to both manage and operate the dermani MEDSPA®, including providing medical services from the dermani MEDSPA®. If you are in a state that permits you to both manage the dermani MEDSPA® and provide medical services, you must sign our Waiver of Management Agreement. More information about the Waiver of Management Agreement is provided below. In the event applicable state law permits franchisees to operate the dermani MEDSPA®, or does not require a PC, then you as the owner of the Franchised Business must satisfy and comply with all other requirements that would otherwise pertain to the PC (for example, obtaining and maintaining professional liability coverage as discussed in Item 8).
We must approve the PC candidate. Under the Management Agreement, you will provide the PC with management and administrative services and support consistent with the System to support the PC's practice and its delivery of medical spa services and related products to clients at the dermani MEDSPA®, consistent with all applicable laws and regulations. The services the Franchised Business will provide to the dermani MEDSPA® include billing and collections, business planning, accounts payable management, bookkeeping and financial management, client records maintenance, management of administrative staff, arranging for the PC to obtain and maintain professional liability insurance, marketing and promotional activities, and arranging legal services and credentialing support. Unless otherwise approved by us, you must use our standard form of Management Agreement, but you may negotiate the monetary terms and, with our written consent, certain other terms of the relationship with the PC. It is your sole responsibility to make sure your Management Agreement is compliant with all state and local laws and must be reviewed by a healthcare attorney knowledgeable in the laws of the state you will be operating. You must have a Management Agreement in effect with a PC at all times during the operation of the Franchised Business and the term of the Franchise Agreement. The Management Agreement may not be signed by you or the PC until we have approved of the Management Agreement and its negotiated terms. In the event the Management Agreement with the PC is terminated during the initial term of your Franchise Agreement, you must enter into a new Management Agreement with a replacement PC as soon as practicable, but in no event later than one hundred twenty (120) days after you provide or receive notice that the Management Agreement with the original PC is being terminated.
The PC will employ and control the physicians and personnel, including, for example, physician assistants, nurse practitioners, medical assistants, estheticians, cosmetic injectors and other similar medical professionals (collectively, the "Affiliated Physicians") who will provide the actual medical services required to be delivered at and through the dermani MEDSPA®. You will not provide any medical services to clients of the dermani MEDSPA® nor will you supervise, direct, control or suggest to the PC or its physicians or employees the manner in which the PC provides or may provide medical services to its clients. Due to various federal and state laws and state professional licensing board rules, regarding the practice of medicine, and the ownership and operation of medical practices and health care businesses that provide medical services, it is critical that you do not engage in practices that are, or may appear to be, the practice of medicine. The dermani MEDSPA® must offer all products and services authorized by us in accordance with the Management Agreement and the System. The only exception to this is if you are in a state that permits you to own a dermani MEDSPA® as well as the entity that provides medical services, as previously discussed above.
You will construct or build-out the dermani MEDSPA® for use by the PC. The Premises will be in an area identified under the Franchise Agreement (the "Territory"). You must operate the Franchised Business and manage the dermani MEDSPA® in the Territory. You must use the System in operating your Franchised Business and at all times perform your obligations under the Franchise Agreement faithfully, honestly, and diligently, and use your best efforts to promote the dermani MEDSPA®. In addition, you will staff the Franchised Business with the type and number of support staff needed to efficiently support the Franchised Business, and the dermani MEDSPA® and its medical personnel.
Area Development Agreement
We also may offer an area development agreement (the "Area Development Agreement") to qualified entities and persons (a "Developer"). The Area Development Agreement grants the right to establish and operate a specified number of Franchised Businesses that will manage dermani MEDSPA®s in a specified area (the "Development Area") at specific locations to be designated in separate Franchise Agreements.
Source: Item 1 — THE FRANCHISOR, AND ANY PARENTS, PREDECESSORS AND AFFILIATES (FDD pages 7–12)
What This Means (2025 FDD)
According to the 2025 Dermani Medspa FDD, franchisees are generally required to enter into a Management Agreement with a professional entity (PC) before operating their franchised business. This PC, which could be a professional corporation or limited liability company, is responsible for providing medical services at the Dermani Medspa. The franchisee provides the PC with management and administrative services to support the PC's practice. These services include billing, business planning, financial management, client record maintenance, administrative staff management, professional liability insurance, marketing, and legal support.
The Management Agreement must adhere to Dermani Medspa's standards, and franchisees must use the standard form unless otherwise approved. While franchisees can negotiate monetary terms and, with written consent, certain other terms, the agreement must comply with all state and local laws. It is the franchisee's responsibility to ensure compliance, including review by a healthcare attorney knowledgeable in the relevant state laws. The Management Agreement must be in effect at all times during the franchise term, and Dermani Medspa must approve the agreement and its terms before it is signed.
However, there's an exception: in states where the law allows a single entity to both manage and operate a medical spa, including providing medical services, franchisees may request a waiver of the Management Agreement. If Dermani Medspa grants this waiver, the franchisee must sign a "Waiver of Management Agreement." Under this waiver, the franchisee agrees to operate the Dermani Medspa and fulfill all responsibilities of both the PC and the Company as outlined in the standard Management Agreement. The franchisee must also confirm they've consulted with an attorney experienced in medical and healthcare laws who has advised them that operating the business as one entity is permissible. Even with these conditions met, Dermani Medspa retains the final decision on whether to permit the waiver. If the Management Agreement is terminated, the franchisee must establish a new agreement with a replacement PC within 120 days.