What section of the Degree Wellness Franchise Agreement is amended to remove provisions regarding termination fees for Minnesota franchises?
Degree_Wellness Franchise · 2025 FDDAnswer from 2025 FDD Document
With respect to the disclosures in Items 6 and 17 of the Disclosure Document, regarding termination fees, Minn. Rule 2860.4400J prohibits termination fees. Accordingly, Items 6 and 17 of the Disclosure Document and Section 15 of the Franchise Agreement are hereby amended to remove all provisions regarding termination fees with respect to franchises governed by Minnesota law.
Source: Item 23 — Receipts (FDD pages 66–257)
What This Means (2025 FDD)
According to the 2025 Degree Wellness Franchise Disclosure Document, for franchises governed by Minnesota law, Section 15 of the Franchise Agreement, along with Items 6 and 17 of the Disclosure Document, are amended to remove all provisions regarding termination fees. This amendment is due to Minn. Rule 2860.4400J, which prohibits termination fees.
This means that if a Degree Wellness franchise is located in Minnesota, the franchisee will not be subject to termination fees if the franchise agreement is terminated. This is a significant benefit for Minnesota franchisees, as termination fees can be a substantial financial burden. Termination fees are designed to compensate the franchisor for losses incurred as a result of the early termination of the franchise agreement.
Prospective franchisees should carefully review the Minnesota Addendum to the Franchise Disclosure Document to understand their rights and obligations under Minnesota law. They should also consult with an attorney to ensure that they fully understand the terms of the franchise agreement.