After Healthsource Chiropractic assigns the franchise agreement to a third party, what are their obligations under the Healthsource Chiropractic agreement?
Healthsource_Chiropractic Franchise · 2025 FDDAnswer from 2025 FDD Document
- 14.3 Transfer by HealthSource Chiropractic. You represent that you have not signed this Agreement in reliance on any owner, officer, or employee remaining with us in that capacity. We may change our ownership or form at any time in our sole discretion. This Agreement is fully transferable by us, without restriction, and will inure to the benefit of any person or entity to whom it is transferred, or to any other legal successor to our interests in this Agreement. After our assignment of this Agreement to a third party who expressly assumes our obligations under this Agreement, we no longer will have any performance or other obligations or liabilities under this Agreement.
Source: Item 23 — Receipts (FDD pages 77–282)
What This Means (2025 FDD)
According to the 2025 Healthsource Chiropractic Franchise Disclosure Document, Healthsource Chiropractic has limited obligations after assigning the franchise agreement to a third party. Specifically, Healthsource Chiropractic is permitted to transfer the agreement without restriction and the agreement will benefit any person or entity to whom it is transferred.
After Healthsource Chiropractic assigns the agreement to a third party that expressly assumes their obligations, Healthsource Chiropractic no longer has any performance or other obligations or liabilities under the agreement. This means that the new franchisee will deal directly with the third party regarding all aspects of the franchise agreement.
This clause protects Healthsource Chiropractic in the event of a sale of the company or a transfer of the franchise system. For a potential franchisee, this means that the relationship with Healthsource Chiropractic could be short-lived if they decide to sell the franchise system. It is important to consider the reputation and financial stability of any potential third party that might take over the franchise agreement.