Are Face Foundrie franchisees required to disclose any interest in beauty-related businesses?
Face_Foundrie Franchise · 2025 FDDAnswer from 2025 FDD Document
ay change over time, that an investment in a Face Foundrié Facial Bar involves business risks, and that the success of the venture is largely dependent on Franchisee's own abilities, efforts and financial resources. Franchisee or its Owners shall truthfully fill out the Franchisee Acknowledgment attached hereto as Exhibit H.
- 1.03 Representations. Franchisee and its Owners, jointly and severally, represent and warrant to Franchisor that: (a) neither Franchisee nor any of its Owners have made any untrue statement of any material fact or has omitted to state any material fact in the written information submitted in obtaining the rights granted hereunder; (b) neither Franchisee nor any of its Owners have any direct or indirect legal or beneficial interest in any beauty-related business that may be deemed a Competitive Business, except as Franchisee has otherwise completely and accurately disclosed in writing to Franchisor in connection with obtaining the rights granted hereunder; and (c) the execution and performance of this Agreement will not violate any other agreement to which Franchisee or any of its Owners may be bound. Franchisee recognizes that Franchisor has executed this Agreement in reliance on all of the statements Franchisee and its Owners have made in writing in connection with this Agreement.
- 1.04 Certain Definitions. The terms listed below have the meanings which follow them and include the plural as well as the singular. Other terms are defined elsewhere in this Agreement in the context in which they arise.
- (a) "Affiliate" Any Person that directly or indirectly owns or controls the referenced party, that is directly or indirectly owned or controlled by the referenced party, or that is under common control with the referenced party. The term "control" means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of an Entity, whether through ownership of voting securities, by contract or otherwise.
Source: Item 22 — CONTRACTS (FDD pages 73–74)
What This Means (2025 FDD)
According to Face Foundrie's 2025 Franchise Disclosure Document, franchisees and their owners must disclose any direct or indirect legal or beneficial interest in any beauty-related business that may be deemed a Competitive Business. This disclosure must be complete and accurate and provided in writing to Face Foundrie when obtaining franchise rights.
A "Competitive Business" is defined as any business operating or franchising an establishment where more than 10% of its offerings consist of facial services or beauty treatments for the face, or that offers waxing services. However, this restriction does not apply to the ownership or operation of other Face Foundrie Facial Bars licensed or franchised by Face Foundrie or its affiliates, or the ownership of shares of a class of securities listed on a public stock exchange or traded over-the-counter, representing less than 5% of that class of securities.
This requirement ensures that Face Foundrie is aware of any potential conflicts of interest. It allows them to assess whether the franchisee's other business interests could negatively impact their ability to operate the Face Foundrie franchise effectively or create a competitive threat. Prospective franchisees should carefully review the definition of "Competitive Business" and fully disclose any relevant interests to avoid potential issues later on.