In the event of termination for default, does Face Foundrie have a lien against the Area Developer's property?

According to Face Foundrie's 2025 Franchise Disclosure Document, if the Area Developer defaults on the agreement and it is terminated, Face Foundrie has certain rights regarding the Area Developer's property. Specifically, Face Foundrie has a lien against the Area Developer's personal property, furnishings, equipment, signs, fixtures, and inventory owned at the time of the default. This lien ensures that Face Foundrie can recover any sums owed by the Area Developer, including damages, costs, expenses, and reasonable attorney's fees incurred due to the default and termination. The lien remains in effect until all outstanding amounts are paid in full.

This means that if an Area Developer fails to meet their obligations under the Area Development Agreement, Face Foundrie can claim a legal right to the specified assets to cover the debts owed to them. This provision is designed to protect Face Foundrie's financial interests in the event of a default by the Area Developer. The Area Developer should be aware of the conditions that constitute a default, as outlined in Section 6 of the agreement, and the potential consequences of such a default, including the imposition of a lien on their business assets.

For a prospective Area Developer, this clause highlights the importance of fulfilling all contractual obligations to avoid default and potential loss of business assets. It is crucial to understand what constitutes a default under the agreement and to maintain open communication with Face Foundrie to address any issues that may arise. This also underscores the need for careful financial planning and management to ensure the Area Developer can meet their financial obligations to Face Foundrie, thereby avoiding the risk of termination and the associated lien on their assets.