What rights does Face Foundrie retain regarding transfers under the Area Development Agreement?
Face_Foundrie Franchise · 2025 FDDAnswer from 2025 FDD Document
sions of the franchise and related agreements. You should read these provisions in the agreements attached to this Disclosure Document.**
Franchise Agreement
| Provision | Section(s) in | Summary | |
|---|---|---|---|
| Area Development Agreement | rights or obligations under the Area Development Agreement, or any material asset of your business, without our prior written consent, which shall be subject to all of the conditions and requirements for transfers set forth in the Franchise Agreement executed simultaneously with the Area Development Agreement that we deem applicable to a proposed transfer under the Area Development Agreement. | ||
| (l) Franchisor approval | Section 7.2 | We have the right to approve transfers. | |
| of transfer by area | |||
| developer | |||
| (m) Conditions for franchisor’s approval of transfer | Sections 7.2 and 7.3 | Unless waived, a transfer of the Area Development Agreement is conditioned on, among other factors, the requirement that the proposed transfer of the Area Development Agreement be made in conjunction with a simultaneous transfer of all existing Franchise Agreements to the same approved transferee. Additionally, your first Facial Bar under your first Franchise Agreement must be open and operating. |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER, AND DISPUTE RESOLUTION OF THE FRANCHISE RELATIONSHIP (FDD pages 51–59)
What This Means (2025 FDD)
According to Face Foundrie's 2025 Franchise Disclosure Document, Face Foundrie retains significant rights regarding the transfer of Area Development Agreements. Face Foundrie has the right to approve any transfers of the Area Development Agreement. These rights are detailed in Section 7.2 of the Area Development Agreement.
Face Foundrie's approval of a transfer is conditional. Unless Face Foundrie waives these conditions, the transfer must include a simultaneous transfer of all existing Franchise Agreements to the same approved transferee. Additionally, the franchisee's first Facial Bar under their first Franchise Agreement must be open and operating before a transfer can be approved.
In the event of the death or incapacitation of the Operating Partner, the area developer must designate a new Operating Partner who owns at least a 20% ownership interest, subject to Face Foundrie's approval. These stipulations ensure that Face Foundrie maintains control over who enters into an Area Development Agreement and that the new party is qualified and committed to operating the franchise according to Face Foundrie's standards.