What constitutes a non-curable default that could lead to 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, there are specific non-curable defaults that could lead to the termination of the Development Agreement. These include ceasing to actively engage in development activities within the Site Selection Area or abandoning the development business for three consecutive months, or any shorter period that indicates an intent to discontinue development of clinics in the designated area.
Additional non-curable defaults include becoming insolvent or being adjudicated bankrupt. Furthermore, if any action is taken by the franchisee or others against the franchisee under any insolvency, bankruptcy, or reorganization act, or if the franchisee makes an assignment for the benefit of creditors, or a receiver is appointed, this can also result in termination.
Finally, if any Franchise Agreement entered into to fulfill development obligations under the Development Agreement is terminated or subject to termination by Healthsource Chiropractic, this constitutes a non-curable default. These stipulations are important for prospective developers to understand, as they outline the conditions under which Healthsource Chiropractic can terminate the Development Agreement without an opportunity for the developer to remedy the situation.