Is a Degree Wellness franchisee required to maintain the confidentiality of the Confidential Information after the franchise term?
Degree_Wellness Franchise · 2025 FDDAnswer from 2025 FDD Document
The Confidential Information is proprietary, and, except to the extent that it is or becomes generally known in the industry or trade, is our trade secret, and is disclosed to you solely for your use in the operation of your franchise during the term of the franchise. You (1) must not use, directly or indirectly, the Confidential Information in any other business or capacity or for any purpose other than as needed in the development or operation of your franchise during the term of the franchise; (2) must maintain the confidentiality of the Confidential Information during and after the term of the franchise and not directly or indirectly publish or otherwise disclose it to any third party; (3) must not make unauthorized copies of any portion of the Confidential Information disclosed in written form or another form or media; and (4) must adopt and implement all reasonable procedures, including any that we may prescribe periodically, to prevent the unauthorized use or disclosure of any of the Confidential Information, including restrictions on disclosure to your employees and the use of nondisclosure clauses in employment agreements with your employees.
Source: Item 14 — Patents, Copyrights, and Proprietary Information (FDD pages 47–48)
What This Means (2025 FDD)
According to Degree Wellness's 2025 Franchise Disclosure Document, franchisees are obligated to maintain the confidentiality of the Confidential Information both during and after the franchise term. This means that even after the franchise agreement expires or is terminated, the franchisee must not disclose Degree Wellness's proprietary information to any third party.
The Confidential Information includes a wide range of proprietary assets, such as methods, techniques, procedures, information, systems, knowledge, and experience related to the design and operation of Degree Wellness franchises. It also encompasses services and products offered, sources of products, advertising and promotional programs, the franchise's image and decor, copyrighted materials, training methods, and the contents of the Operations Manual.
This ongoing confidentiality obligation is a standard practice in franchising to protect the franchisor's competitive advantage and trade secrets. Franchisees must not use the Confidential Information in any other business or capacity, or for any purpose other than operating their Degree Wellness franchise. They are also required to implement reasonable procedures to prevent unauthorized use or disclosure of the Confidential Information, including imposing restrictions on their employees and using nondisclosure agreements.
For a prospective Degree Wellness franchisee, this means understanding that the duty of confidentiality extends beyond the term of the franchise agreement. It is crucial to safeguard the Confidential Information and avoid any actions that could compromise its secrecy, as this could lead to legal repercussions.