Does the expiration of the Face Foundrie Area Development Agreement depend on the execution of Franchise Agreements?
Face_Foundrie Franchise · 2025 FDDAnswer from 2025 FDD Document
| Provision | Section(s) in | Summary | |
|---|---|---|---|
| Area Development Agreement | rights or obligations under the Area Development Agreement, or any material asset of your business, without our prior written consent, which shall be subject to all of the conditions and requirements for transfers set forth in the Franchise Agreement executed simultaneously with the Area Development Agreement that we deem applicable to a proposed transfer under the Area Development Agreement. | ||
| (l) Franchisor approval | Section 7.2 | We have the right to approve transfers. | |
| of transfer by area | |||
| developer | |||
| (m) Conditions for franchisor’s approval of transfer | Sections 7.2 and 7.3 | Unless waived, a transfer of the Area Development Agreement is conditioned on, among other factors, the requirement that the proposed transfer of the Area Development Agreement be made in conjunction with a simultaneous transfer of all existing Franchise Agreements to the same approved transferee. Additionally, your first Facial Bar under your first Franchise Agreement must be open and operating. |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER, AND DISPUTE RESOLUTION OF THE FRANCHISE RELATIONSHIP (FDD pages 51–59)
What This Means (2025 FDD)
Based on the 2025 Face Foundrie Franchise Disclosure Document, the expiration of the Area Development Agreement itself is not explicitly stated to depend on the execution of Franchise Agreements. However, the FDD indicates that a transfer of the Area Development Agreement is tied to the simultaneous transfer of existing Franchise Agreements. Specifically, unless waived by Face Foundrie, a transfer of the Area Development Agreement requires a simultaneous transfer of all existing Franchise Agreements to the same approved transferee. Additionally, the franchisee's first Facial Bar under their first Franchise Agreement must be open and operating.
This conditionality around transferring the Area Development Agreement suggests a close relationship between the Area Development Agreement and the individual Franchise Agreements. While the expiration isn't directly linked, the ability to transfer the Area Development Agreement is contingent upon the status and transferability of the Franchise Agreements. This could indirectly affect the Area Developer's rights and obligations under the Area Development Agreement.
Prospective Area Developers should clarify with Face Foundrie the specific conditions under which the Area Development Agreement can be terminated or expire, and how the execution and performance of individual Franchise Agreements within the development area impact the overall Area Development Agreement. Understanding these nuances is crucial for managing expectations and planning the development strategy within the designated area.