How will a different Continuing Franchise Fee for Degree Wellness be reflected?
Degree_Wellness Franchise · 2025 FDDAnswer from 2025 FDD Document
You may not, on grounds of alleged non-performance by Degree Wellness of its obligations under this Agreement, withhold payment of Continuing Franchise Fees and/or any other amounts due to Degree Wellness and/or its related parties or affiliates.
6.9 Modification of Payments. If, by operation of law or otherwise, any fees contemplated by this Agreement cannot be based upon gross revenues, then you and we agree to negotiate in good faith an alternative fee arrangement. If you and we are unable to reach an agreement on an alternative fee arrangement, then Degree Wellness reserves the right to terminate this Agreement upon notice to you, in which case all of the post-termination obligations set forth in Section 16 shall apply.
Source: Item 23 — Receipts (FDD pages 66–257)
What This Means (2025 FDD)
According to Degree Wellness's 2025 Franchise Disclosure Document, modifications to payments, including the Continuing Franchise Fee, may occur if the standard fee structure based on gross revenues becomes untenable due to legal or other reasons. In such cases, Degree Wellness and the franchisee must negotiate in good faith to find an alternative fee arrangement.
If Degree Wellness and the franchisee cannot agree on a new fee structure, Degree Wellness retains the right to terminate the franchise agreement. Should Degree Wellness choose to terminate the agreement, the franchisee is then subject to post-termination obligations as outlined in Section 16 of the agreement.
This clause ensures that Degree Wellness can adapt its fee structure if the original method becomes unviable, but it also carries the risk of termination for the franchisee if an agreement cannot be reached. Prospective franchisees should understand this potential outcome and be prepared to negotiate in good faith should the situation arise.