What obligation does a Degree Wellness franchisee have to indemnify the franchisor?

According to the 2025 Degree Wellness Franchise Disclosure Document, the franchisee's obligation to indemnify, reimburse, defend, or hold harmless the franchisor or other parties is modified. The franchisee is not obligated to indemnify, reimburse, defend, or hold harmless the franchisor or any other indemnified party for losses or liabilities resulting from the indemnified party's negligence, willful misconduct, strict liability, or fraud.

In simpler terms, while the franchise agreement might typically require the franchisee to protect Degree Wellness from certain liabilities, this provision is limited. The franchisee is not responsible for covering losses or liabilities that arise due to Degree Wellness's own actions, such as negligence, intentional misconduct, or fraudulent activities. This modification aims to protect franchisees from bearing the financial burden of the franchisor's mistakes or intentional wrongdoing.

This is a beneficial modification for prospective Degree Wellness franchisees. It ensures that they are not held responsible for the franchisor's actions. Franchisees should still carefully review the franchise agreement to understand the full scope of their indemnification obligations and the specific circumstances under which they might be required to provide indemnification, keeping in mind this important exception.