What happens if a Face Foundrie franchisee fails to comply with the System requirements?

Franchisee recognizes the mutual benefit to Franchisee, Franchisor and other Face Foundrié Facial Bars of the uniformity of the appearance, products, services and advertising of the System and acknowledges and agrees that such uniformities are necessary for the successful operation of the Facial Bar.

Franchisee also acknowledges and agrees that Franchisor has worked to develop and maintain a reputation for excellence with respect to the products and services sold under the Marks and at Face Foundrié Facial Bars, and Franchisee acknowledges and agrees that it is of the utmost importance to Franchisor, Franchisee and all other Face Foundrié Facial Bars that such reputation be maintained.

As such, Franchisee covenants and agrees with respect to the operation of the Facial Bar that Franchisee and its employees and agents will comply with all of the requirements of the System and the Operations Manual and will throughout the Term:

Upon receipt of written notice of such revocation, Franchisee shall cease to sell or use any disapproved item, Products and/or cease to purchase from any disapproved supplier.

• (c) Franchisee shall comply with all federal, state and local laws, codes and regulations, including the applicable provisions of the ADA, regarding the construction, design and operation of the Facial Bar.

• (d) Franchisee shall comply with all standards, specifications and requirements issued by Franchisor with respect to the Computer System and the Required Software, and with respect to Computer Upgrades.

Franchisee agrees to comply with Franchisor's System standards regarding Memberships, including regarding the following matters: (i) the types and terms of Memberships it may offer; (ii) the form(s) of Membership Agreement; (iii) the terms and conditions upon which a member may transfer his or her Membership from the Facial Bar to another Face Foundrié Facial Bar and vice versa; (iv) admission of members of the Facial Bar to other Face Foundrié Facial Bars; (v) procedures to follow when members transfer to or from the Facial Bar; (vi) use and acceptance of coupons, passes, certificates, and gift cards; (vii) group accounts and group Memberships (and discounts applicable thereto); and (viii) payment terms for Memberships.

• (b) promptly return to Franchisor all material furnished by Franchisor containing proprietary or confidential information, operating instructions, business practices, or methods or procedures, including, without limitation, the Operations Manual;

• (c) discontinue all use of the Marks, including at the Premises and on the vehicle, and the use of any and all signs, products, equipment and other items bearing the Marks.

Any signs containing the Marks that Franchisee is unable to remove within one (1) day of the termination or expiration of this Agreement shall be completely covered by Franchisee until the time of their removal, which shall be in any event within ten (10) days following the expiration or termination of this Agreement;

• (d) at the option of Franchisor, assign to Franchisor any interest which Franchisee has in any lease or sublease for the Premises if Franchisee leases a location for the Facial Bar.

In the event Franchisor does not elect to exercise its option to acquire the lease or sublease for the Premises, Franchisee must, at Franchisee's expense, make such reasonable modifications to the exterior and interior décor of the Facial Bar and the Premises, and with respect to any vehicles, as Franchisor requires to eliminate its identification as a Face Foundrié Facial Bar.

If Franchisee fails to modify the exterior and interior décor of the Facial Bar, the Premises, and vehicles, as Franchisor requires to eliminate its identification as a Face Foundrié Facial Bar, Franchisor may take such action to modify the exterior and interior décor of the Facial Bar and the Premises and charge Franchisee for the cost of such action.

Franchisee shall immediately pay Franchisor for the cost of any action taken by Franchisor to modify the exterior and interior décor of the Facial Bar and the Premises;

• (e) refrain from operating or doing business under any name or in any manner that may give the general public the impression that this Agreement is still in force or that Franchisee is connected in any way with Franchisor or that Franchisee has the right to use the System or the Marks, and Franchisee, shall not thereafter, directly or indirectly, represent to the public or hold itself out as a present or former operator of Franchisor in connection with the promotion or operation of any other business;

Source: Item 22 — CONTRACTS (FDD pages 73–74)