Under what grounds can a Degree Wellness franchisee terminate the franchise agreement?
Degree_Wellness Franchise · 2025 FDDAnswer from 2025 FDD Document
16. RIGHTS AND OBLIGATIONS OF COMPANY AND FRANCHISE OWNER UPON TERMINATION OR EXPIRATION OF THE FRANCHISE.
- 16.1 Payment of Amounts Owed to Degree Wellness. You agree to pay us within five (5) days after the effective date of termination or expiration of the Franchise, or any later date that the amounts due to us are determined, all amounts owed to us or our affiliates which are then unpaid including, without limitation, any unpaid Initial Franchise Fee, any unpaid Continuing Franchise Fees, and any termination fee, damages, costs or expenses owed by you pursuant to Section 15.3, together with any audit costs and expenses owed by you pursuant to Section 13.2.
- 16.2 Marks. Use of the Marks and Copyrightable Works after the termination or expiration of the Studio Franchise will constitute the unlawful use of our intellectual property rights, which include trademarks and service marks. You agree that after the termination or expiration of the Franchise you will:
- a. not directly or indirectly at any time identify any business with which you are associated as a current or former Degree Wellness franchise or franchisee;
- b. not use any Mark, any colorable imitation of any Mark, or any Copyrightable Works in any manner or for any purpose, or use for any purpose any trademark or other commercial symbol that suggests or indicates an association with us;
- c. return to us or destroy (whichever we specify) all customer lists, forms and materials containing any Mark or any Copyrightable Works or otherwise relating to a Degree Wellness franchise;
- d. remove all Marks affixed to uniforms or, at our direction, cease to use those uniforms; and
e. take any action that may be required to cancel all fictitious or assumed name or equivalent registrations relating to your use of any Mark.
You irrevocably appoint Degree Wellness your attorney-in-fact to take the actions described in this paragraph if you do not do so yourself within 10 days after termination of this Agreement.
- 16.3 De-Identification.
If you retain possession of the Premises, you agree to completely remove or modify, at your sole expense, any part of the interior and exterior decor that we deem necessary to disassociate the Premises with the image of a Degree Wellness franchise, including any signage, posters, furniture, equipment, products, or display units bearing the Marks.
Source: Item 23 — Receipts (FDD pages 66–257)
What This Means (2025 FDD)
Based on the 2025 Degree Wellness Franchise Disclosure Document, the document does not explicitly state the grounds under which a franchisee can terminate the franchise agreement. However, it does outline the rights and obligations of both the company and the franchise owner upon termination or expiration of the franchise.
The FDD includes details on the franchisee's obligations upon termination, such as payment of outstanding amounts, ceasing the use of trademarks and confidential information, and de-identifying the premises. It also mentions the franchisor's remedies upon termination due to franchisee default, including potential termination fees and recovery of damages.
Since the FDD excerpts do not provide specific conditions under which a Degree Wellness franchisee can terminate the agreement, prospective franchisees should directly ask the franchisor about the circumstances that would allow them to terminate the franchise agreement, any associated penalties or procedures, and whether there are any opportunities for early termination.