Does Degree Wellness have the right to require franchisees to participate in an electronic funds transfer program?
Degree_Wellness Franchise · 2025 FDDAnswer from 2025 FDD Document
The amount actually transferred from the Account to pay Continuing Franchise Fees and Fund contributions will be based on the Franchise's gross revenues reported to us.
If you have not reported the Franchise's gross revenues for any reporting period, then we will be authorized to debit the Account in an amount equal to 120% of the Continuing Franchise Fee, Fund contribution, and other amounts transferred from the Account for the last reporting period for which a report of the Franchise's gross revenues was provided to us.
If at any time we determine that you have under-reported the Franchise's gross revenues or underpaid any Continuing Franchise Fee or Fund contribution due us under this Agreement, then we will be authorized to initiate immediately a debit to the Account in the appropriate amount, plus applicable interest, in accordance with the foregoing procedure.
Any overpayment will be credited, without interest, against the Continuing Franchise Fee, Fund contribution, and other amounts we otherwise would debit from your account during the following reporting period.
Our use of electronic funds transfers as a method of collecting Continuing Franchise Fees and Fund contributions due us does not constitute a waiver of any of your obligations to provide us with monthly reports as provided in Section 12, nor shall it be deemed a waiver of any of the rights and remedies available to us under this Agreement.
Source: Item 23 — Receipts (FDD pages 66–257)
What This Means (2025 FDD)
According to Degree Wellness's 2025 Franchise Disclosure Document, Degree Wellness is authorized to use electronic funds transfers to collect Continuing Franchise Fees and Fund contributions. The amount transferred will be based on the franchisee's reported gross revenues.
If a Degree Wellness franchisee fails to report gross revenues for any period, Degree Wellness can debit an amount equal to 120% of the amount transferred for the last reporting period where gross revenues were reported. Additionally, if Degree Wellness determines that a franchisee has under-reported gross revenues or underpaid any fees, Degree Wellness is authorized to immediately debit the account for the underpaid amount, plus applicable interest.
Any overpayment by the franchisee will be credited against future fees without interest. Degree Wellness's use of electronic funds transfers does not waive the franchisee's obligation to provide monthly reports, nor does it waive any of Degree Wellness's rights and remedies under the agreement.
This electronic funds transfer policy ensures that Degree Wellness can efficiently collect fees and contributions, while also protecting itself against underreporting or non-payment. Franchisees should ensure they accurately report gross revenues to avoid any discrepancies or additional charges.