What is considered 'Confidential Information' for a Degree Wellness franchisee, and what restrictions are placed on its use?
Degree_Wellness Franchise · 2025 FDDAnswer from 2025 FDD Document
you make to us pursuant to this Agreement (except for our own income taxes), (5) our actions taken relating to the enforcement of this Agreement, and/or (6) your breach of any provision of this Agreement.**
- e. The allocation of responsibility and your indemnification obligations described above will continue in full force and effect after, and notwithstanding, the expiration, renewal or termination of this Agreement.
9. CONFIDENTIAL INFORMATION; NON-COMPETITION; OTHER COVENANTS.
9.1 Types of Confidential Information. We possess certain unique confidential and proprietary information and trade secrets consisting of the following categories of information, methods, techniques, products, services and knowledge developed by us, including but not limited to: (a) services and products offered and sold at Degree Wellness franchises; (b) knowledge of sales and profit performance
of any one or more Degree Wellness franchises; (c) knowledge of sources of products sold at Degree Wellness franchises, (d) advertising and promotional programs and image and decor; (e) methods, techniques, formats, specifications, procedures, information, systems, and knowledge of, and experience in, the development, operation, and franchising of Degree Wellness franchises; (f) copyrighted materials, including, without limitation, office forms and procedures, marketing materials, telephone scripts and the content of the Operations Manual; and (g) the methods of training employees. We will disclose much of the above-described information to you in advising you about site selection, providing our Initial Training, providing access to the Operations Manual, and providing guidance and assistance to you under this Agreement. In addition, in the course of the operation of your Franchise, you or your employees may develop ideas, concepts, methods, or techniques of improvement relating to the Franchise that you agree to disclose to us, and that we may then authorize you to use in the operation of your Franchise, and may use or authorize others to use in other Degree Wellness franchises owned or franchised by us or our affiliates. (All of such information disclosed to or developed by you will be referred to in this Agreement as our "Confidential Information".)
9.2 Non-Disclosure Agreement.
- a. You agree that your relationship with us does not vest in you any interest in the Confidential Information, other than the right to use it solely in the development and operation of the Franchise during the Term of this Agreement, and that the use or duplication of the Confidential Information in any other business or for any other purpose would constitute an unfair method of competition or otherwise result in irreparable damage to us.
- b. You acknowledge and agree that the Confidential Information belongs to us, may contain trade secrets belonging to us, and is disclosed to you or authorized for your use solely on the condition that you agree, and you therefore do agree, that you (1) will not use, directly or indirectly, the Confidential Information in any business or capacity or for any purpose other than as needed in the development and operation of the Franchise during the Term of this Agreement; (2) will maintain the absolute confidentiality of the Confidential Information during and after the Term of this Agreement and not directly or indirectly publish or otherwise disclose it to any third party; (3) will not make unauthorized copies of any portion of the Confidential Information disclosed in written form or another form or media that may be copied or duplicated; and (4) will adopt and implement all reasonable procedures, including any that we may prescribe from time to time, to prevent unauthorized use or disclosure of the Confidential Information, including without limitation restrictions on disclosure to or by your employees, and the use of non-disclosure, non-solicitation, non-disparagement and non-competition agreements we may prescribe or approve for your shareholders, partners, members, officers, directors, employees, independent contractors, or agents who may have access to the Confidential Information. You acknowledge and agree that we are
under no duty or obligation to you to enforce any such Agreements for your or our benefit. Your duties and obligations with respect to Confidential Information shall survive the Transfer, termination or expiration of this Agreement.
9.3 Non-Competition Agreement and Other Restrictive Covenants.
- a. Non-Competition. You agree that we would be unable to protect the Confidential Information against unauthorized use or disclosure, and would be unable to encourage a free exchange of ideas and information among Degree Wellness franchises, if franchise owners of Degree Wellness franchises were permitted to hold interests in any competitive businesses (as described below).
Source: Item 23 — Receipts (FDD pages 66–257)
What This Means (2025 FDD)
According to Degree Wellness's 2025 Franchise Disclosure Document, Confidential Information encompasses a wide array of proprietary details. This includes the services and products offered at Degree Wellness franchises, knowledge of sales and profit performance of any Degree Wellness franchise, sources of products, advertising and promotional programs, image and decor, methods, techniques, formats, specifications, procedures, information, systems, and knowledge related to the development, operation, and franchising of Degree Wellness franchises. It also includes copyrighted materials like office forms, marketing materials, telephone scripts, and the content of the Operations Manual, as well as employee training methods. Any ideas, concepts, methods, or techniques of improvement relating to the franchise that a franchisee develops are also considered Confidential Information.
The FDD places significant restrictions on the use of this Confidential Information. Franchisees can only use it for the development and operation of their Degree Wellness franchise during the term of the agreement. They are prohibited from using or duplicating the information in any other business or for any other purpose. Franchisees must maintain absolute confidentiality during and after the term of the agreement and cannot disclose it to any third party. Unauthorized copies of the information are also prohibited, and franchisees must implement reasonable procedures to prevent unauthorized use or disclosure, including non-disclosure agreements with employees.
These restrictions are typical in franchising to protect the brand's competitive advantage and proprietary systems. The franchisee acknowledges that the Confidential Information belongs to Degree Wellness and may contain trade secrets. The franchisee's obligations regarding Confidential Information survive the transfer, termination, or expiration of the franchise agreement. This means that even after the franchise relationship ends, the franchisee is still bound by the confidentiality obligations. Degree Wellness also states that they would be unable to protect the Confidential Information against unauthorized use or disclosure if franchise owners of Degree Wellness franchises were permitted to hold interests in any competitive businesses.
Moreover, upon termination or expiration of the franchise, the franchisee must immediately cease using any of the Confidential Information and return all copies of the Operations Manual and any written Confidential Information. The non-disclosure covenants outlined in the agreement survive the termination or expiration, reinforcing the long-term commitment to protecting Degree Wellness's proprietary assets. This comprehensive approach ensures that Degree Wellness maintains control over its valuable information and prevents it from being used to the detriment of the franchise system.