What happens if a Degree Wellness Licensed Provider becomes bankrupt or insolvent?

According to Degree Wellness's 2025 Franchise Disclosure Document, if a Licensed Provider, or any of its owners if the Licensed Provider is an entity, is adjudged bankrupt, becomes insolvent, or makes a general assignment for the benefit of creditors, it constitutes a default under the agreement. This gives Management Company the right to terminate the agreement effective immediately upon delivering a termination notice to the Licensed Provider.

This means that if a Degree Wellness Licensed Provider faces severe financial difficulties leading to bankruptcy or insolvency, the Management Company has the right to terminate the license agreement. The Licensed Provider would lose the right to operate under the Degree Wellness brand and utilize its associated resources.

This clause protects Degree Wellness by ensuring that its brand is not associated with financially unstable entities. Bankruptcy or insolvency can negatively impact the reputation and goodwill of the Degree Wellness brand, and this provision allows Degree Wellness to sever ties with such entities promptly. Prospective Licensed Providers should carefully consider the financial risks associated with operating a Degree Wellness studio and ensure they have sufficient capital and a sound business plan to avoid financial distress.

It is important for potential Degree Wellness Licensed Providers to understand the implications of this default provision and to seek professional financial advice to assess their ability to meet their financial obligations under the license agreement. Maintaining financial stability is crucial for the long-term success of a Degree Wellness studio and to avoid the risk of termination due to bankruptcy or insolvency.