Who is the Degree Wellness franchise agreement binding upon?
Degree_Wellness Franchise · 2025 FDDAnswer from 2025 FDD Document
ctors, 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). Therefore, during the Term of this Agreement, neither you, nor any Principal Owner, nor any member of your immediate family or of the immediate family of any Principal Owner, shall directly or indirectly perform services for, or have any direct or indirect interest as an owner, investor, partner, director, officer, employee, manager, consultant, representative, or agent in, any business that offers products or services the same as or similar to those offered or sold at Degree Wellness Studio franchises; provided, however, that the ownership of one percent (1%) or less of a publicly traded company will not be deemed to be prohibited by this Paragraph.
- b. Non-Disparagement. You agree that during the Term of this Agreement, and thereafter following any Transfer, termination or expiration of this Agreement, neither you, nor any Principal Owner, nor any member of your immediate family or of the immediate family of any Principal Owner, will directly or indirectly make any negative or critical statements to any third parties, either verbally or in any other form or media, about (a) us, the Franchise, any of our franchisees, or any of their respective products, services, businesses or business practices, or (b) the actions, operations or character of any of our or their respective owners, officers, directors, employees, consultants or agents.
- c. Non-Solicitation. You agree that during the Term of this Agreement, and thereafter for a period of two (2) years following any Transfer, termination or expiration of this Agreement, neither you, nor any Principal Owner, nor any member of your immediate family or of the immediate family of any Principal Owner, will directly or indirectly (a) solicit for wellness or related services or products with any person who was a member or client of the Franchise within the two year period prior to such Transfer, termination or expiration; or (b) interfere with our relationship with any of our franchisees, vendors, suppliers or referral sources.
- d. General Managers to Sign Agreement. You further agree that you will cause each General Manager to enter into and deliver to us a Restrictive Covenant Agreement in such form as we may approve, either concurrently with the execution of this Agreement or at such later date when the affiliation of such person with you is established. You acknowledge and agree that we are under no duty or obligation to you to enforce any such Agreements for your or our benefit. The duties and obligations imposed in the
Restrictive Covenant Agreement shall survive the Transfer, expiration or earlier termination of this Agreement.
e. Covenants are Reasonable and Necessary. It is the express intention of the parties hereto to comply with all laws which may be applicable to this Agreement. You acknowledge and agree that a breach of any provision of this Section 9.3 would cause immediate and irreparable harm to us. Therefore, you acknowledge and agree that the foregoing restraints are fair and reasonable, are required for the protection of our legitimate business interests, and do not impose any undue hardship on you.
10. DEGREE WELLNESS FRANCHISE OPERATING STANDARDS.
- 10.1 Condition and Appearance of the Franchise. You agree that:
- a. neither the Franchise nor the Premises will be used for any purpose other than the operation of the Franchise in compliance with this Agreement;
- b. you will maintain the condition and appearance of the Franchise; its equipment, furniture, furnishings, and signs;
Source: Item 23 — Receipts (FDD pages 66–257)
What This Means (2025 FDD)
According to Degree Wellness's 2025 Franchise Disclosure Document, the franchise agreement is binding upon several parties. Specifically, during the term of the agreement, the franchisee, any Principal Owner, and members of their immediate families are restricted from engaging in or holding interests in businesses that compete with Degree Wellness Studio franchises. This restriction includes performing services for or having a direct or indirect interest as an owner, investor, partner, director, officer, employee, manager, consultant, representative, or agent in any competitive business. An exception is made for owning one percent (1%) or less of a publicly traded company.
Furthermore, the agreement includes non-disparagement clauses that extend beyond the term of the agreement. Following any transfer, termination, or expiration of the agreement, the franchisee, any Principal Owner, and their immediate family members are prohibited from making negative or critical statements about Degree Wellness, its franchisees, or their respective businesses and personnel. This restriction applies to statements made to any third parties, whether verbally or through any other form of media.
The agreement also contains non-solicitation clauses that extend for two years following any transfer, termination, or expiration of the agreement. During this period, the franchisee, any Principal Owner, and their immediate family members are prohibited from soliciting wellness or related services or products from any person who was a member or client of the Franchise within the two-year period prior to the transfer, termination, or expiration. They are also prohibited from interfering with Degree Wellness's relationships with its franchisees, vendors, suppliers, or referral sources. These comprehensive restrictions are designed to protect Degree Wellness's interests and maintain the integrity of its franchise system.
In the event of a transfer of the franchise, the Proposed New Owner must agree to assume all obligations under the existing agreement or execute a new Franchise Agreement with Degree Wellness. Degree Wellness may also require the original franchisee to guarantee the performance and obligations of the Proposed New Owner. Upon the death or permanent disability of the franchisee or a Principal Owner, their interest must be transferred within twelve months to a person approved by Degree Wellness, subject to all terms and conditions for assignments and transfers contained in the agreement. Failure to comply with these transfer requirements can result in termination of the agreement.