Does the Degree Wellness Franchise Agreement contain a covenant not to compete that extends beyond the termination of the franchise, and what is the potential issue regarding its enforceability under California law?

According to Degree Wellness's 2025 Franchise Disclosure Document, the Franchise Agreement does contain a covenant not to compete that extends beyond the termination of the franchise. However, the FDD indicates that this provision may not be enforceable under California law. This is a critical point for prospective franchisees in California to consider.

California law generally disfavors non-compete agreements, especially those that restrict a person's ability to work in their chosen profession after the franchise relationship ends. The enforceability of such clauses often depends on specific circumstances and legal interpretations at the time of enforcement.

Therefore, a potential Degree Wellness franchisee in California should seek legal counsel to fully understand the implications and enforceability of the non-compete clause in their specific situation. This will help them assess the risks and potential limitations on their business activities after the franchise agreement concludes.