Can I, as a Degree Wellness franchisee, employ an on-site general manager instead of actively participating in the operation myself?
Degree_Wellness Franchise · 2025 FDDAnswer from 2025 FDD Document
ise must operate at a site we approve and according to our standards, specifications, operating procedures, and rules (the "System Standards"). Unless we approve your employment of an on-site general manager to operate your Degree Wellness franchise, you (if you are an individual) or one of your principal owners, officers, directors, or employees approved by us (if you are a legal entity) must actively participate in the actual operation of the franchise, and devote as much of your time as may be reasonably necessary for its efficient operation. If we agree to your employment of a general manager, then the general manager will supervise the dayto-day operation of your franchise. Each general manager and successor general manager must attend and complete our initial training program for your franchise prior to commencing the role of General Manager (see Item 11). We do not require that the general manager have an equity interest in your franchise, but he or she cannot have any interest in or business relationship with any business competitor of your franchise, and must sign a written agreement to maintain confidential the proprietary information described in Item 14 and conform with the covenants not to compete described in Items 17(q) and 17(r), as well as non-disparagement and non-solicitation covenants described in Items 17 (x) and 17(y). Some state laws and regulations affecting the healthcare profession may require a licensed professional to own or supervise your franchise or that you enter into a management agreement with a licensed professional. You are responsible for complying with these state laws and regulations.
Obligations of Owners
You (if an individual) or each of your owners (if you are a legal entity) must sign an Assumption and Guarantee of Obligations (attached to the Franchise Agreement as Exhibit 3), agreeing to be bound by and guaranteeing your obligations as the "franchisee" under your Franchise Agreement. If you and/or your owners transfer your Franchise Agreement or any related interest, then you and/or the owners making the assignment must agree to be bound by the terms of the Agreement, and guarantee the obligations of the "franchisee" under the Agreement. As a
condition of our consent to allow you to transfer your franchise to a third party, we may require you to guarantee the performance of a third party. You and your owners must at all times faithfully, honestly and diligently perform your and their obligations under the Franchise Agreement. You and they must promote and enhance your franchise.
Source: Item 15 — Obligation to Participate in the Actual Operation of the Franchise Business (FDD pages 48–49)
What This Means (2025 FDD)
According to Degree Wellness's 2025 Franchise Disclosure Document, you may be able to employ an on-site general manager to operate your Degree Wellness franchise, but this is subject to Degree Wellness's approval. If you are an individual, or if you are a legal entity, one of your principal owners, officers, directors, or employees approved by Degree Wellness must actively participate in the actual operation of the franchise and devote as much time as reasonably necessary for its efficient operation, unless Degree Wellness approves your employment of a general manager. If Degree Wellness agrees to the employment of a general manager, that general manager will supervise the day-to-day operations of your franchise.
The Degree Wellness FDD specifies that each general manager and successor general manager must attend and complete the initial training program for your franchise before starting their role. The general manager is not required to have an equity interest in your franchise. However, they cannot have any interest in or business relationship with any business competitor of your franchise. The general manager must also sign a written agreement to maintain the confidentiality of proprietary information and conform with non-compete, non-disparagement, and non-solicitation covenants.
It's important to note that some state laws and regulations affecting the healthcare profession may require a licensed professional to own or supervise your franchise, or require you to enter into a management agreement with a licensed professional. As the franchisee, you are responsible for complying with these state laws and regulations. Furthermore, if Degree Wellness changes the System, your General Manager may be required to obtain additional licenses or certifications.