Under the Degree Wellness transfer agreement, what must the Assignee agree to discharge?
Degree_Wellness Franchise · 2025 FDDAnswer from 2025 FDD Document
- j. the Franchise shall have been determined by us to contain all equipment and fixtures in good working condition, as were required at the initial opening of the Franchise. The Proposed New Owner shall have agreed, in writing, to make such reasonable capital expenditures to remodel, equip, modernize and redecorate the interior and exterior of the premises in accordance with our then existing plans and specifications for a Degree Wellness Studio franchise, and shall have agreed to pay our expenses for plan preparation or review, and site inspection.
- k. Upon receiving our consent for the Transfer or sale of the Franchise, the Proposed New Owner shall agree to assume all of your obligations under this Agreement in a form acceptable to us, and/or, at our option, shall agree to execute a new Franchise Agreement with us in the form then being used by us. We may, at our option, require that you guarantee the performance, and obligations of the Proposed New Owner.
Source: Item 23 — Receipts (FDD pages 66–257)
What This Means (2025 FDD)
According to Degree Wellness's 2025 Franchise Disclosure Document, a Proposed New Owner (Assignee) must agree to several obligations as part of the transfer process. Specifically, the Assignee must agree to assume all of the seller's obligations under the existing Franchise Agreement or, at Degree Wellness's option, execute a new Franchise Agreement. Degree Wellness also retains the option to require the seller to guarantee the performance and obligations of the Proposed New Owner.
In addition to assuming the seller's obligations, the Proposed New Owner must also agree, in writing, to make reasonable capital expenditures to remodel, equip, modernize, and redecorate the interior and exterior of the premises. This remodeling must align with Degree Wellness's current plans and specifications for a Degree Wellness Studio franchise. The Proposed New Owner must also cover Degree Wellness's expenses for plan preparation or review and site inspection.
These conditions ensure that the new franchisee is committed to maintaining the standards and image of the Degree Wellness brand. By requiring the assignee to assume all obligations and potentially remodel the premises, Degree Wellness aims to ensure a smooth transition and continued success of the franchise under new ownership. Prospective franchisees should carefully consider these requirements and associated costs when planning to transfer ownership of a Degree Wellness franchise.