Upon termination or non-renewal of the Degree Wellness franchise agreement, what specific actions are franchisees required to take regarding customer lists and materials bearing Degree Wellness's marks?
Degree_Wellness Franchise · 2025 FDDAnswer from 2025 FDD Document
| Provision | Section in Franchise Agreement | Summary |
|---|---|---|
| Agreement, we may terminate the | ||
| Franchise Agreement. | ||
| i. Your obligations on termination/ non-renewal | Section 16 | You must pay all amounts owed to us; refrain from using our Marks, return to us or destroy (as we specify) all customer lists, forms and materials bearing our Marks or relating to the franchise; de-identify the franchise premises; return the Operations Manual; comply with covenants against competition and the non solicitation, non-disparagement, and non-disclosure covenants in Section 9 of the Franchise Agreement; and cease using all confidential information. |
| You irrevocably appoint us your | ||
| attorney-in-fact- | ||
| to de-identify your | ||
| franchise premises and enforce your | ||
| requirement to discontinue use of the | ||
| Marks if you do not perform these | ||
| obligations within 10 days of the | ||
| termination of your Agreement. | ||
| You | ||
| must | ||
| also | ||
| (1) | ||
| execute | ||
| any | ||
| documents | ||
| and | ||
| take | ||
| any | ||
| steps | ||
| necessary to delete your listings from | ||
| classified | ||
| telephone | ||
| directories, | ||
| disconnect, or, at our option, assign to | ||
| us all telephone numbers that have | ||
| been | ||
| used | ||
| in | ||
| your | ||
| Franchised | ||
| Business, assign to | ||
| us any URLs, | ||
| domain names, and social media and | ||
| social networking names that you | ||
| have used in connection with your | ||
| Franchised Business, and terminate | ||
| all other references that indicate you | ||
| are or ever were affiliated with us, and | ||
| (2) give us a final accounting for your | ||
| Studio, and you must maintain all | ||
| accounts and records for your Studio | ||
| for a period of not less than seven | ||
| years after final payment of any | ||
| amounts you owe to us, our affiliates, | ||
| and/or related persons, but you may | ||
| not | ||
| sell, | ||
| disclose, | ||
| or | ||
| otherwise |
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, upon termination or non-renewal of the franchise agreement, franchisees have several obligations. Specifically, they must pay all outstanding amounts owed to Degree Wellness. Furthermore, franchisees are required to cease using Degree Wellness's marks and must either return or destroy, as specified by Degree Wellness, all customer lists, forms, and materials that bear Degree Wellness's marks or relate to the franchise.
In addition to the handling of branded materials and customer lists, franchisees must also de-identify the franchise premises, ensuring no remaining indication of Degree Wellness's presence. The operations manual must be returned to Degree Wellness. Moreover, franchisees must comply with covenants against competition, non-solicitation, non-disparagement, and non-disclosure agreements as outlined in Section 9 of the Franchise Agreement. Franchisees are also obligated to cease using all confidential information related to the Degree Wellness franchise.
To ensure compliance, Degree Wellness is irrevocably appointed as the franchisee's attorney-in-fact, allowing Degree Wellness to de-identify the franchise premises and enforce the discontinuation of the use of Degree Wellness's marks if the franchisee fails to meet these obligations within 10 days of termination. Franchisees must also execute documents and take necessary steps to delete listings from classified telephone directories, disconnect or assign telephone numbers used in the Franchised Business to Degree Wellness, assign URLs, domain names, and social media names used in connection with the franchise, and terminate all references indicating affiliation with Degree Wellness. Finally, a final accounting for the studio must be provided, and all accounts and records must be maintained for seven years after final payment of any amounts owed.