What actions related to insolvency, bankruptcy, or reorganization can trigger termination of the Healthsource Chiropractic Development Agreement?
Healthsource_Chiropractic Franchise · 2025 FDDAnswer from 2025 FDD Document
the Development Agreement during the Development Period (including any monetary default) and you fail to cure such default within 30 days of receiving notice. | | h. | "Cause" defined – non-curable defaults | Section 6.2 | We may terminate the Development Agreement if you cease to actively engage in development activities in the Site Selection Area or otherwise abandon your development business for three consecutive months, or any shorter period that indicates an intent | | | Provision | Section in Development Agreement | Summary | |----|---------------------------------------------------------------------------------|----------------------------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------| | | | | by you to discontinue development of the Clinics within the Site Selection Area; you become insolvent or are adjudicated bankrupt, or if any action is taken by you, or by others against the you, under any insolvency, bankruptcy or reorganization act, or if you make an assignment for the benefit or creditors or a receiver is appointed by you; and any Franchise Agreement that is entered into in order to fulfill your development obligations under the Development Agreement is terminated or subject to termination by us, pursuant to the terms of that Franchise Agreement. | | i.
Source: Item 17 — Renewal, Termination, Transfer, and Dispute Resolution (FDD pages 53–64)
What This Means (2025 FDD)
According to Healthsource Chiropractic's 2025 Franchise Disclosure Document, the Development Agreement can be terminated by the franchisor if certain insolvency-related events occur. Specifically, Healthsource Chiropractic can terminate the agreement if the developer becomes insolvent or is adjudicated bankrupt.
Additionally, termination can be triggered if any action is taken by the developer, or by others against the developer, under any insolvency, bankruptcy, or reorganization act. This means that not only the developer's direct actions but also actions initiated by third parties against the developer under such acts can lead to termination.
Finally, Healthsource Chiropractic can terminate the Development Agreement if the developer makes an assignment for the benefit of creditors or a receiver is appointed. These provisions protect Healthsource Chiropractic from potential financial instability or mismanagement on the part of the developer that could jeopardize the development of new franchise locations.