FranchiseVerdict
Degree Wellness logo
B55/100FDD 2025

Degree Wellness — Litigation & Risk

Health & Fitness · FDD Items 3, 4 & 5

Back to overview

Lower Risk

No litigation cases disclosed in FDD Items 3 and 4.

Source: FDD Items 3–5

FDD Items 3 & 4

Litigation Metrics

Cases disclosed
0
Total from FDD Items 3 and 4
Bankruptcy (Item 4)
—
Franchisor or officer bankruptcy
Overall risk score
55 / 100
FranchiseVerdict composite
Rating
MODERATE
STRONG / MODERATE / CAUTION / AVOID

7(a) FOIA data · FY2020–present

SBA Loan Performance

Aggregated from public SBA 7(a) loan disclosures. Default rate is the share of loans that were charged off or settled for less than the full balance.

Total 7(a) loans
16
Government-backed loans issued
Default rate
—
vs <3% typical · system-wide
5-yr default rate
—
Defaults
0 loans
Loans charged off or defaulted
Total loan volume
$9.2M
Avg loan size
$573K
Participating lenders
9

FDD Items 5, 6 & 17 — what you give up

Contract Risk Indicators

Mandatory arbitration
Required
Disputes resolved outside court — limits your legal options
Jury trial waiver
Waived
You give up the right to a jury trial
Franchisor can compete
Yes
Franchisor can open competing locations in or near your territory
Right of first refusal
Yes
Franchisor can match any purchase offer when you try to sell
Governing law
Florida
State whose law governs disputes — relevant if you're not based there

What drove the 55/100 rating

Risk Score Breakdown

  1. 01MINOROnly 4 units in system with unknown growth trajectory indicates unproven scalability and minimal network support
  2. 02MINORWide investment range ($342.4K–$795.4K) with no explanation suggests inconsistent site costs or vague financial planning
  3. 03MEDNo Item 19 (financial performance representations) disclosed—cannot verify if $610K average revenue and $288K net income are achievable or representative
  4. 04MINORExtremely small franchisee base (4 units) limits ability to validate claims or receive peer support
  5. 05MINORHigh royalty rate (7%) combined with ambiguous revenue figures creates profitability uncertainty for new franchisees

Severity inferred from FDD text — not a regulatory or legal classification

Litigation data from FDD Items 3, 4, and 5. SBA data from public 7(a) FOIA records (FY2020–present). Not legal advice — consult a franchise attorney before signing any franchise agreement.