What are the restrictions on a Degree Wellness franchisee's ability to modify or alter the approved business model, considering their obligations under the franchise agreement (Item 9)?
Degree_Wellness Franchise · 2025 FDDAnswer from 2025 FDD Document
es in employment agreements with your employees.
Item 15
OBLIGATION TO PARTICIPATE IN THE ACTUAL OPERATION OF THE FRANCHISE BUSINESS
Your Studio franchise must operate at a site we approve and according to our standards, specifications, operating procedures, and rules (the "System Standards"). Unless we approve your employment of an on-site general manager to operate your Degree Wellness franchise, you (if you are an individual) or one of your principal owners, officers, directors, or employees approved by us (if you are a legal entity) must actively participate in the actual operation of the franchise, and devote as much of your time as may be reasonably necessary for its efficient operation. If we agree to your employment of a general manager, then the general manager will supervise the dayto-day operation of your franchise. Each general manager and successor general manager must attend and complete our initial training program for your franchise prior to commencing the role of General Manager (see Item 11). We do not require that the general manager have an equity interest in your franchise, but he or she cannot have any interest in or business relationship with any business competitor of your franchise, and must sign a written agreement to maintain confidential the proprietary information described in Item 14 and conform with the covenants not to compete described in Items 17(q) and 17(r), as well as non-disparagement and non-solicitation covenants described in Items 17 (x) and 17(y). Some state laws and regulations affecting the healthcare profession may require a licensed professional to own or supervise your franchise or that you enter into a management agreement with a licensed professional. You are responsible for complying with these state laws and regulations.
Obligations of Owners
You (if an individual) or each of your owners (if you are a legal entity) must sign an Assumption and Guarantee of Obligations (attached to the Franchise Agreement as Exhibit 3), agreeing to be bound by and guaranteeing your obligations as the "franchisee" under your Franchise Agreement.
What This Means (2025 FDD)
According to Degree Wellness's 2025 Franchise Disclosure Document, franchisees must operate their studio according to the System Standards set by Degree Wellness. These standards include specifications, operating procedures, and rules that Degree Wellness establishes. Unless Degree Wellness approves the employment of an on-site general manager, the franchisee (if an individual) or a principal owner, officer, director, or employee approved by Degree Wellness (if a legal entity) must actively participate in the actual operation of the franchise and devote as much time as reasonably necessary for its efficient operation.
The franchisee is obligated to operate the Degree Wellness Studio at a site that Degree Wellness approves. The premises will be used only for the operation of the studio. The landlord consents to the franchisee's use of Degree Wellness's Proprietary Marks and signs, interior and exterior décor, furnishings, fixtures, items, color schemes, plans, specifications, and related components of Degree Wellness System as prescribed by Degree Wellness for the Studio.
These stipulations ensure that each Degree Wellness location maintains a consistent brand identity and operational model. This consistency is crucial for customer recognition and trust. For a prospective franchisee, this means limited flexibility in altering the business model or making independent operational decisions without prior approval from Degree Wellness. Franchisees need to adhere strictly to the franchisor's guidelines to maintain uniformity across all Degree Wellness locations.