What staffing requirements are there for a Dermani Medspa franchise?

the Manuals (maintained at our home office) will be controlling.

ITEM 15. OBLIGATION TO PARTICIPATE IN THE ACTUAL OPERATION OF THE FRANCHISE BUSINESS

You or your Operating Principal must manage and provide general oversight of the Franchised Business on a full-time basis. Your failure to have the Franchised Business managed on a full-time basis by you or your Operating Principal is a default for which we may terminate the Franchise Agreement if the default persists for 30 days after notice from us.

The "Operating Principal" means the person, shareholder, member, or partner that you designate to be responsible for overseeing and supervising the operation of the Franchised Business, and is the person with whom we will communicate on all major policy, financial, management and operation matters, and the only person from your entity that we will recognize as having authority to communicate for you. The Operating Principal does not need to possess equity interest in the Franchised Business. You may not change the Operating Principal without our prior written consent. We require that all owners, except those that hold a small ownership interest in the franchises (less than 10%), sign a guarantee and assumption of obligations in the form attached to the Franchise Agreement as Exhibit E. Spouses of owners are not required to sign a guarantee and assumption of obligations.

You must keep us informed at all times of the identity of any supervisory employee(s), including your Operating Principal, your manager and the dermani MEDSPA'®s physician(s) or other individuals providing medical services. You must make sure that the Franchised Business is staffed with adequate non-medical personnel to meet the needs of the dermani MEDSPA®, and you must make sure that the dermani MEDSPA® is staffed with adequate medical personnel to efficiently and effectively meet client needs.

If you own or control more than one Franchised Business, we reserve the right to require you to be a corporate entity, and each Franchised Business must be under the direct on-premises supervision of one of your principals who is designated as the Operating Principal for that Franchised Business and who has completed our training program to our satisfaction.

All management personnel and any other personnel that we designate must meet minimum qualifications that we may specify and complete such training programs as we may require, before managing the Franchised Business or training other personnel. If we learn or determine that a person is regarded as no longer complying with our standards and procedures, then we may require that person to satisfactorily complete training or a re-training program. We reserve the right to charge for retraining personnel.

In addition, all management personnel and other personnel working at the Franchised Business or the dermani MEDSPA® must satisfactorily complete all state and local government required training and must meet all mandatory licensing and certification requirements.

Your Operating Principal, manager and other personnel we designate must sign a confidentiality and non-competition agreement, in a form that is acceptable to us, which will contain covenants we require. We will be a third party beneficiary to this agreement with the independent right to enforce the agreement's terms.

You or your Operating Principal will have sole responsibility for all employment decisions and functions related to your Franchised Business, including hiring, firing, compensation, benefits, work hours, work rules, record-keeping, supervision, and discipline of employees, notwithstanding any suggestions, advice, guidelines, programs or training that we may offer. You, your Operating Principal and

your managers must comply with all federal, state and local laws and regulations regarding employmentrelated matters. All personnel decisions must be made by you, and all decisions will be made without any influence or advice from us. All personnel decisions and actions will not be, nor be deemed to be, a decision or action of ours. You must take such steps as are necessary to ensure that your employees preserve good customer relations;

Source: Item 15 — OBLIGATION TO PARTICIPATE IN THE ACTUAL OPERATION OF THE FRANCHISE BUSINESS (FDD pages 48–50)