What is the consideration for the Healthsource Chiropractic General Release Agreement?
Healthsource_Chiropractic Franchise · 2025 FDDAnswer from 2025 FDD Document
with all the terms and conditions of this Agreement up to the date of expiration, and not just on those conditions set forth in our 6 month deficiency notice. If we send a notice of non-renewal, it will state the reasons for our refusal to renew.
c. Renewal Agreement; Releases. To renew the Franchise, HealthSource Chiropractic, you and your Principal Owners must execute the form of Franchise Agreement and any ancillary agreements we are then customarily using in the grant or renewal of franchises for the operation of Clinic Franchises (with appropriate modifications to reflect the fact that the agreement relates to the grant of a renewal franchise), except that no initial franchise fee will be payable upon renewal of the Franchise. The terms of the Franchise Agreement that you must execute upon renewal, and any other agreements we may require, may differ materially from those contained in this Agreement, including the possibility of increased Continuing Franchise Fees and Ad Fund contributions. Your right to renew will be contingent upon your acceptance of the new terms. You must pay to us a renewal fee equal to $10,000.00 concurrently with signing the renewal
Source: Item 23 — Receipts (FDD pages 77–282)
What This Means (2025 FDD)
According to the 2025 Healthsource Chiropractic Franchise Disclosure Document, when renewing a franchise, franchisees and their Principal Owners must execute a general release of claims against Healthsource Chiropractic and its affiliates. In exchange for this release, Healthsource Chiropractic will allow the franchisee to renew their franchise agreement.
Specifically, the FDD states that no initial franchise fee is payable upon renewal. Instead, a renewal fee of $10,000 is due concurrently with signing the renewal Franchise Agreement. The franchisee's right to renew is contingent upon acceptance of the new terms and conditions outlined in the renewal agreement, which may differ significantly from the original agreement, potentially including increased Continuing Franchise Fees and Ad Fund contributions.
In essence, by signing the general release, the franchisee agrees to waive any existing or future claims against Healthsource Chiropractic in exchange for the opportunity to continue operating their franchise under a new agreement. This is a fairly standard practice in franchising, as it provides the franchisor with legal protection and allows for a clean slate moving forward. However, franchisees should carefully consider the implications of signing such a release and consult with an attorney if they have any concerns about potential claims against the franchisor.