What happens if a Degree Wellness Licensed Provider or its owners are convicted of a felony?
Degree_Wellness Franchise · 2025 FDDAnswer from 2025 FDD Document
- (d) Licensed Provider or, if Licensed Provider is an entity, any of its owners, is convicted of or pleads no contest to a felony or are convicted or plead no contest to any crime or offense that is likely to adversely affect the reputation of Management Company, the Studio Management Business, Degree Wellness, and/or the goodwill associated with the System or the Marks, or otherwise engages in any dishonest, unethical or other conduct that is reasonably likely to reflect materially and unfavorably on the goodwill or reputation of Management Company, the Studio Management Business, the System or the Marks;
Source: Item 20 — OUTLETS AND FRANCHISEE INFORMATION (FDD pages 63–66)
What This Means (2025 FDD)
According to Degree Wellness's 2025 Franchise Disclosure Document, if a Licensed Provider or any of its owners are convicted of a felony, it constitutes a default under the agreement. Specifically, if the Licensed Provider or its owners are convicted of, or plead no contest to, a felony, Management Company has the right to terminate the agreement effective immediately upon delivering notice of termination to the Licensed Provider.
This also applies if the Licensed Provider or its owners are convicted of, or plead no contest to, any crime or offense that could negatively impact the reputation of Management Company, the Studio Management Business, Degree Wellness, or the goodwill associated with the System or the Marks. This extends to any dishonest, unethical, or other conduct that could reflect unfavorably on the goodwill or reputation of Management Company, the Studio Management Business, the System, or the Marks.
This clause highlights the importance of maintaining a clean criminal record and ethical business practices for both the Licensed Provider and its owners. A felony conviction or any action that damages the brand's reputation can lead to immediate termination of the agreement, resulting in a loss of the franchise and associated investment. Prospective franchisees should carefully consider this provision and ensure they and their owners meet the required standards of conduct.