Can Degree Wellness terminate the Development Agreement without cause?
Degree_Wellness Franchise · 2025 FDDAnswer from 2025 FDD Document
| Provision | Section in Development Agreement | Summary | |
|---|---|---|---|
| e. | Termination by franchisor without cause | Not Applicable | Not Applicable |
| f. | Termination by franchisor with cause | Section 6.2 | We may terminate your Development Agreement with cause as described in (g)-(h) of this Item 17 Chart. |
| g. | "Cause" defined – curable defaults | Section 6.2 | We may terminate the Development Agreement if you fail to meet your development obligations under the Development Agreement |
Source: Item 17 — Renewal, Termination, Transfer, and Dispute Resolution (FDD pages 49–59)
What This Means (2025 FDD)
According to Degree Wellness's 2025 Franchise Disclosure Document, Degree Wellness cannot terminate the Development Agreement without cause. The table in Item 17 outlines the conditions under which Degree Wellness can terminate the Development Agreement, and these conditions all relate to specific failures or defaults on the part of the franchisee.
Specifically, Degree Wellness may terminate the Development Agreement if the franchisee fails to meet their development obligations or ceases to actively engage in development activities within the Site Selection Area for three consecutive months (or a shorter period indicating intent to discontinue development). Termination can also occur if the franchisee becomes insolvent or bankrupt, makes an assignment for the benefit of creditors, or if any related Franchise Agreement is terminated.
These termination conditions are fairly standard in franchising, as they protect Degree Wellness's brand and ensure that franchisees are actively developing their territories as agreed. A prospective Degree Wellness franchisee should carefully review Section 6.2 of the Development Agreement, as referenced in the table, to fully understand what constitutes a curable or non-curable default and what steps they can take to avoid termination.