For Face Foundrie, what is the relationship between the franchisee and the franchisor?

Face Foundrié Franchising L.L.C. (the "Franchisor") and its affiliates developed and own a format and system (the "System") for establishing and operating a focused facial bar concept under the trademark "FACE FOUNDRIÉ"®, which offers efficient and effective services, including 20-to-50-minute facials, waxing, and skincare products, all delivered with high-end customer service (each is referred to as a "Face Foundrié Facial Bar").

Franchisor and Franchisee have executed a Franchise Agreement ("Franchise Agreement") granting Franchisee the right to operate a Face Foundrié Facial Bar (the "Franchised Facial Bar") under the terms and conditions of the Franchise Agreement.

In connection with starting or continuing your employment with Franchisee, you will be trained by us and you will learn of Franchisor's confidential information and know-how concerning the methods of operation of a Face Foundrié Facial Bar and the System*.*

Now, therefore, it is agreed that as a consideration of starting or continuing your employment, as a condition to your employment and the compensation that we have paid to you (and/or will pay you after today), you acknowledge and agree that you will comply with all of the following obligations:

2. GRANT OF RIGHTS.

• 2.01 Grant of Franchise. Subject to the terms of this Agreement, Franchisor grants to Franchisee the right, and Franchisee assumes the obligation, to operate a Facial Bar from the location set forth on Exhibit A hereto (the "Premises") and to use the System and the Marks solely in connection therewith, for a term of ten (10) years, commencing on the Effective Date of this Agreement (the "Term").

Franchisee may not conduct the business of the Facial Bar or use the System at any site other than the Premises, or relocate the Facial Bar, without Franchisor's prior written consent.

Any approved relocation of the Facial Bar shall be at Franchisee's sole cost and expense, and Franchisor shall have the right to charge Franchisee a relocation fee equal to One Thousand Dollars ($1,000) plus any expenses Franchisor incurs in facilitating the relocation.

The option for renewal of the rights granted to Franchisee in this Agreement is described in Section 15 below.

• 2.02 Protected Territory. During the Term, Franchisor will not operate (directly or through an Affiliate), nor grant to another Person the right to operate, any Face Foundrié Facial Bar located within the geographical area set forth on Exhibit A hereto (the "Protected Territory").

Notwithstanding the foregoing, Franchisor has the right to operate (directly or through an Affiliate), and to grant to others the right to operate, within the Protected Territory and elsewhere: (a) Face Foundrié Facial Bars or other businesses using any part or all of the System and/or Marks that are operating as of the Effective Date; and (b) businesses that Franchisor or its Affiliates purchase (or as to which Franchisor or its Affiliates purchases the rights as franchisor) that are part of another franchise system or chain and either continue to operate them independently or convert them to Face Foundrié Facial Bars.

• 2.03 Reservation of Rights. Notwithstanding anything to the contrary set forth herein, Franchisor retains the right, in its sole discretion, to:

8.03 Management of Facial Bar.

• (a) Franchisee must designate on Exhibit B an "Operating Partner", which individual must be approved by Franchisor and: (a) own and control, or have the right to own and control (subject to terms and conditions reasonably acceptable to Franchisor), not less than a twenty percent (20%) interest in Franchisee's equity and voting rights; (b) have the authority to bind Franchisee regarding all operational decisions with respect to the Facial Bar; and (c) have completed Franchisor's training program to its satisfaction.

The Operating Partner must devote full-time efforts to the Facial Bar, and the Operating Partner may not engage in any other business or activity, directly or indirectly, that requires substantial management responsibility or time commitments or otherwise that may conflict with his or her obligations hereunder without our approval.

Franchisee shall provide Franchisor with a copy of any proposed arrangement, agreement or contract, and all amendments thereto, with the Operating Partner for Franchisor's prior review and approval, and upon approval thereof, executed copies thereof.

Franchisor shall have no responsibility, liability or obligation to any party to any such arrangement, agreement or contract, or any amendments thereto, on account of Franchisor's approval thereof or otherwise, and Franchisee agrees to indemnify and hold Franchisor harmless with respect thereto.

The Facial Bar at all times must be supervised by the Operating Partner who has completed the appropriate training programs to our satisfaction.

• (b) Salon Manager.

At least ninety (90) days prior to the opening of your Facial Bar, you agree to designate and to retain at all times during the term of this Agreement a Salon Manager who meets our qualifications to supervise the operation of your Facial Bar.

Your Salon Manager must devote full time and best efforts to the supervision of your Facial Bar and shall not engage in any other business, including the supervision or management of any additional Face Foundrié Facial Bar(s).

Each Face Foundrié Facial Bar must have a different Salon Manager.

You acknowledge and agree that the appointment of a Salon Manager will not relieve your Operating Partner of his or her supervisory responsibilities for the operation of your Facial Bar.

You and your Operating Partner shall remain fully responsible for your Salon Manager's performance.

Agreement, and if it does so, Franchisee will use the form of Membership Agreement that Franchisor provides to Franchisee, and will not make any modifications in the forms without Franchisor's prior written consent. Notwithstanding the foregoing, Franchisee acknowledges that it is responsible for ensuring that the Membership Agreements and its offer of Memberships comply with all applicable laws for its Facial Bar. If such laws require that Franchisee modify the Membership Agreements or the terms of Membership that if offers, Franchisee may do so only to the extent necessary to comply with such applicable laws, provided that Franchisee provide Franchisor with written notice at least fourteen (14) days prior to such modifications. Any Membership Agreement that has been modified without Franchisor's consent shall be void. 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. Franchisee agrees that Franchisor and its Affiliates own all information relating to clients and members of the Facial Bar, including names, addresses, telephone numbers, e-mail addresses, buying habits, preferences, demographic information and related information, that it comprises personal information and part of the Confidential Information, and that Franchisor and its Affiliates may use such membership information in its and their business activities.

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