What are the minimum development obligations for a Degree Wellness developer during each Development Period?
Degree_Wellness Franchise · 2025 FDDAnswer from 2025 FDD Document
ach execute the form of personal guaranty attached to the foregoing Franchise Agreement, as well as any additional Franchise Agreements described in Section 4 of this Agreement.
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- Additional Franchise Agreements. Developer agrees and acknowledges that it must: (i) enter into Franchisor's then-current form of Franchise Agreement for each Additional Studio that Developer is required to open under this Agreement; and (ii) enter into such Franchise Agreements at such times that are required for Developer to timely meet, and strictly adhere to, its obligations under the agreed upon Development Schedule.
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- Development Obligations. Developer must ensure that, at a minimum, Developer: (i) opens and commences operations of the number of new Studios during each of the development periods defined in the Development Schedule (each, a "Development Period"); and (ii) has the minimum cumulative number of Studios open and operating at the expiration of each such Development Period. The parties agree and acknowledge that time is of the essence with respect to the foregoing development obligations, and that Developer's failure to comply with the Development Schedule in any manner with respect to any Development Period is grounds for immediate termination of this Agreement if not timely cured as set forth in Section 6.2 of this Agreement (and any future development rights granted hereunder).
6. Term and Termination.
Source: Item 23 — Receipts (FDD pages 66–257)
What This Means (2025 FDD)
According to Degree Wellness's 2025 Franchise Disclosure Document, a developer must open and commence operations of a specific number of new studios during each development period, as defined in the Development Schedule. They must also ensure that a minimum cumulative number of studios are open and operating by the end of each development period.
The Development Schedule included as Attachment A specifies the number of studios a developer is expected to open within certain timeframes. For example, within the first 12 months from the effective date of the agreement, the developer must open 1 new studio. By months 13 through 24, the developer must open another studio, bringing the cumulative number of studios open to 2. Finally, by months 25 through 36, the developer is required to have a total of 3 studios open and operating.
Degree Wellness emphasizes that adhering to the Development Schedule is critical, stating that time is of the essence. Failure to meet the development obligations within any Development Period can result in immediate termination of the Development Agreement, especially if the failure is not cured as per the agreement's terms. This underscores the importance of careful planning and execution for any prospective developer to avoid potential penalties and maintain their development rights.