What is the meaning of 'control' in the context of Face Foundrie's definition of 'Affiliate'?
Face_Foundrie Franchise · 2025 FDDAnswer from 2025 FDD Document
- (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, the term 'control' within the definition of 'Affiliate' refers to the power to direct the management and policies of an entity. This power can be exercised directly or indirectly.
This control can be established through various means, including ownership of voting securities, contractual agreements, or other arrangements. Essentially, if a person or entity has the ability to dictate the direction of another entity's management and policies, they are considered to be in control.
For a prospective Face Foundrie franchisee, this definition is important because it clarifies the scope of 'Affiliate' relationships. This can have implications for various aspects of the franchise agreement, such as competitive restrictions or obligations related to confidentiality. Understanding who is considered an 'Affiliate' is crucial for ensuring compliance with the terms of the franchise agreement and avoiding potential conflicts of interest.