What are the obligations of a Degree Wellness franchisee regarding the maintenance of a positive and professional image (Item 9), considering the trademark rights granted by the franchisor (Item 13)?

According to the 2025 Degree Wellness Franchise Disclosure Document, franchisees are granted the right to operate their franchise using Degree Wellness's principal marks, including the name "Degree Wellness", the stylized "d" and " ENERGY FOR LIFE". This right is contingent upon adhering to the standards, specifications, operating procedures, and rules set forth by Degree Wellness, collectively known as the "System Standards."

Maintaining a positive and professional image is crucial for Degree Wellness franchisees, as the franchisor has established substantial goodwill and business value in its marks, expertise, and system. Franchisees must operate their studio at an approved site and according to the System Standards. Unless Degree Wellness approves the employment of an on-site general manager, the franchisee (if an individual) or a principal owner/officer (if a legal entity) must actively participate in the franchise's operation and devote sufficient time for its efficient operation. This active involvement ensures that the franchise consistently reflects the brand's image and standards.

Upon termination or expiration of the franchise agreement, the franchisee's obligations regarding the brand image become even more critical. The franchisee must discontinue all use of Degree Wellness's marks and copyrightable works, as continued use would constitute unlawful infringement of intellectual property rights. Franchisees must also avoid any action that might associate their business with Degree Wellness and take steps to de-identify the premises by removing or modifying any decor that links it to the Degree Wellness brand. These measures protect Degree Wellness's brand image and prevent consumer confusion after a franchise relationship ends.

In summary, Degree Wellness franchisees are entrusted with the use of the brand's trademarks and must maintain a professional image by adhering to operational standards and actively managing their studio. This obligation extends beyond the franchise term, requiring franchisees to completely disassociate from the brand upon termination or expiration of the agreement to protect Degree Wellness's established goodwill and intellectual property rights.