Under what conditions does the Indiana Franchise Act prohibit Degree Wellness from unilaterally terminating a franchise agreement?

According to Degree Wellness's 2025 Franchise Disclosure Document, the Indiana Franchise Act has specific provisions that protect franchisees from unfair termination. Specifically, IC section 23-2-2.7-1(7) prohibits Degree Wellness from unilaterally terminating a franchise agreement without good cause or in bad faith. The FDD clarifies that 'good cause' includes any material violation of the Franchise Agreement.

This provision means that Degree Wellness cannot simply terminate a franchise on a whim or for arbitrary reasons if the franchise is located in Indiana. There must be a legitimate and substantial reason, such as a significant breach of the agreement by the franchisee. This offers a level of protection to the franchisee, ensuring that their investment and business operations are not jeopardized by unwarranted actions from the franchisor.

However, it is important for prospective Degree Wellness franchisees in Indiana to understand what constitutes a 'material violation' of the Franchise Agreement. This will be defined within the agreement itself, so careful review with legal counsel is essential. Franchisees should also be aware of their rights and responsibilities under both the Franchise Agreement and the Indiana Franchise Act to ensure compliance and avoid potential grounds for termination. This protection applies specifically to unilateral terminations, meaning terminations initiated solely by Degree Wellness, and does not necessarily cover terminations resulting from mutual agreement or other circumstances.