Does the agreement to arbitrate for Degree Wellness franchise disputes extend to related agreements, excluding leases or subleases with Degree Wellness or its affiliates?
Degree_Wellness Franchise · 2025 FDDAnswer from 2025 FDD Document
a. Agreement to Arbitrate. Except insofar as we elect to enforce this Agreement or to
seek temporary or permanent injunctive relief as provided above, all controversies, disputes or claims arising between us, our affiliates, and our and their respective owners, officers, directors, agents, and employees (in their representative capacity) and you (and your Principal Owners and guarantors) arising out of or related to: (1) this Agreement, any provision thereof, or any related agreement (except for any lease or sublease with us or any of our affiliates); (2) the relationship of the parties hereto; (3) the validity of this Agreement or any related agreement, or any provision thereof; or (4) any specification, standard or operating procedure relating to the establishment or operation of the Franchise, shall be submitted for arbitration to be administered by the office of the American Arbitration Association.
Source: Item 23 — Receipts (FDD pages 66–257)
What This Means (2025 FDD)
According to Degree Wellness's 2025 Franchise Disclosure Document, the agreement to arbitrate extends to disputes arising from the franchise agreement, any provision thereof, or any related agreement. However, this does not include any lease or sublease with Degree Wellness or its affiliates. This means that if a dispute arises concerning the franchise agreement itself or related agreements, it will be settled through arbitration, except if the dispute involves a lease or sublease agreement with Degree Wellness.
This arbitration clause covers controversies or claims between Degree Wellness, its affiliates, and their respective owners, officers, directors, agents, and employees, and the franchisee, their principal owners, and guarantors. The disputes subject to arbitration include those related to the franchise agreement, the relationship of the parties, the validity of the agreement, and any specifications, standards, or operating procedures related to the franchise's establishment or operation.
For a prospective Degree Wellness franchisee, this means that most disputes will be resolved through arbitration, which is generally faster and less expensive than litigation. However, disputes related to leases or subleases with Degree Wellness are excluded from this arbitration agreement, potentially leading to separate legal proceedings in those specific cases. It is important for the franchisee to understand the scope of this arbitration agreement and its exclusions, as it will govern how disputes are resolved.