If the transferee of a Face Foundrie franchise is not an individual, what requirements apply to the beneficial owners?
Face_Foundrie Franchise · 2025 FDDAnswer from 2025 FDD Document
roval of a Transfer that meets all of the reasonable restrictions, requirements and conditions Franchisor may impose on the Transfer, the transferor(s) and/or the transferee(s), including the following:
(a) Franchisee and its Owners and Affiliates must be in compliance with the provisions of this Agreement and all other agreements with Franchisor or any of its Affiliates and have paid all outstanding amounts owed thereto, as well as to the approved suppliers to the System;
(b) The transferee shall demonstrate to Franchisor's satisfaction that the terms of the proposed transfer do not place an unreasonable financial or operational burden on the transferee, and that the transferee (or, if the transferee is other than an individual, such owners of beneficial interests in the transferee as Franchisor may request) meets Franchisor's then-current application qualifications (which may include educational, managerial, socially responsible, and business standards, good moral character, business reputation, and cr
Source: Item 22 — CONTRACTS (FDD pages 73–74)
What This Means (2025 FDD)
According to Face Foundrie's 2025 Franchise Disclosure Document, if the transferee is not an individual, Face Foundrie may request that the beneficial owners of the transferee meet Face Foundrie's then-current application qualifications. These qualifications can include educational, managerial, socially responsible, and business standards, good moral character, business reputation, and credit rating. Face Foundrie also assesses whether the beneficial owners possess the aptitude and ability to operate the Facial Bar, have no conflicting interests, and have adequate financial resources and capital to operate the Facial Bar.
Furthermore, Face Foundrie may require the transferee and/or the owners of the transferee to guarantee the performance of the transferee's obligations in writing, using a form that is satisfactory to Face Foundrie. This ensures that Face Foundrie has recourse to the personal assets of the owners if the non-individual transferee fails to meet its financial or operational obligations under the franchise agreement.
These requirements are designed to ensure that any transfer of a Face Foundrie franchise maintains the brand's standards and protects its reputation. By scrutinizing the qualifications and financial stability of the beneficial owners, Face Foundrie aims to minimize the risk of operational or financial mismanagement that could negatively impact the franchise system. Prospective franchisees should be prepared to provide detailed information about the ownership structure and the qualifications of all beneficial owners if the franchise is being transferred to a non-individual entity.