Can the Protected Territory for my Degree Wellness franchise be changed after the initial designation?
Degree_Wellness Franchise · 2025 FDDAnswer from 2025 FDD Document
Provided you are in full compliance with this Agreement, neither we nor our affiliates will operate or grant a franchise for the operation of another Studio franchise physically located within the territory described in Exhibit 1 (the "Protected Territory").
You and we will mutually designate your Protected Territory upon or after the signing of this Agreement and Exhibit 1 shall be deemed to be automatically updated and revised to reflect such designation or any mutually agreed upon changes to your Protected Territory.
Except as otherwise provided in this Paragraph 2.3, we retain all rights with respect to Studio franchises, the Marks and the System, including (by way of example only and not as a limitation): (a) the right to operate or grant others the right to operate Studio franchises physically located outside the Protected Territory on terms and conditions we deem appropriate; (b) the right to operate or offer other healthcare-related companies or franchises or enter into other lines of business offering similar or dissimilar products or services under trademarks or service marks other than the Marks, both within or outside of the Protected Territory and to use other channels of distribution (for example, the internet, email, social media, telemarketing, or other direct marketing) in connection with such system(s) and/or location(s); (c) the right to sell or distribute, at retail or wholesale, directly or indirectly, or via the internet or any other means, or license others to sell or distribute, via any means (including the internet and other channels of distribution) any products that bear any proprietary marks, including the Marks, whether within or outside your Protected
Territory; (d) the right to own, acquire, establish, and/or operate, and license others to establish and operate, businesses different from a Franchised Business but operated under the Marks within or outside your Protected Territory, and to use other channels of distribution (for example, the internet, email, social media, telemarketing, or other direct marketing) in connection with such system(s) and/or location(s); and (e) the right to be acquired (whether though acquisition of assets, or equity interests or otherwise, regardless of the form of transaction) by a business or entity providing products and services similar to those provided by Franchised Businesses even if that business or entity operates, franchises, or licenses competitive businesses in your Protected Territory.
Source: Item 23 — Receipts (FDD pages 66–257)
What This Means (2025 FDD)
According to Degree Wellness's 2025 Franchise Disclosure Document, the Protected Territory, which defines the area where neither Degree Wellness nor its affiliates will operate or franchise another Degree Wellness Studio, is initially designated upon or after signing the Franchise Agreement. Exhibit 1 of the agreement will reflect this designation.
Importantly, the FDD states that changes to the Protected Territory can be made after the initial designation, but only if both Degree Wellness and the franchisee mutually agree to the changes. If both parties agree to revise the Protected Territory, Exhibit 1 will be updated to reflect the new designation.
However, Degree Wellness retains significant rights outside the Protected Territory. Degree Wellness has the right to operate or franchise other studios outside the Protected Territory, offer other healthcare-related services under different trademarks, sell products bearing its marks through various channels, and operate different businesses under the Degree Wellness marks, even within the franchisee's Protected Territory. These retained rights could potentially impact a franchisee's business, as Degree Wellness could engage in activities that might compete with the franchisee's studio, even within the designated area.