factual

What is the definition of 'Ad Fund' for Healthsource Chiropractic?

Healthsource_Chiropractic Franchise · 2025 FDD

Answer from 2025 FDD Document

ansfer systems that we designate from time to time, in order that the Franchise may accept customers' credit and debit cards, checks, and other methods of payment. We may require you to obtain such services through us or our affiliates or designated third parties.

HealthSource Chiropractic – 2025 Franchise Agreement

11. ADVERTISING.

11.1 By HealthSource Chiropractic. As stated in Paragraph 6.3a, due to the value of advertising and the importance of promoting the public image of HealthSource Chiropractic Clinic franchises, we may establish, maintain, and administer an Ad Fund to support and pay for national, regional, or local marketing and promotional programs that we deem necessary, desirable, or appropriate, in our sole discretion, to promote the good will and image of all HealthSource Chiropractic Clinic franchises. You will contribute to it the Advertising Fee set forth in Section 6.3a. We agree that any Clinics owned by us or our affiliates will be required to contribute to the Ad Fund on at least the same basis as you do, subject only to limitation under applicable law. HealthSource Chiropractic will be entitled to direct all advertising programs financed by the Ad Fund, with sole discretion over (i) the creative concepts, materials, endorsements, and media used therein, and (ii) the geographic, market, and media placement and allocation of the programs. HealthSource Chiropractic shall have the right to determine, in its sole discretion, the composition of all geographic territories and market areas for the development and implementation of such programs. You agree that the Ad Fund may be used to pay any and all costs of maintaining, administering, directing, and preparing national, regional or local advertising materials, programs, and promotional activities, including, without limitation, (a) costs for preparing and conducting television, radio, magazine, billboard, newspaper, internet and other media programs and activities, (b) costs associated with conducting marketing research, (c) costs associated with website development and marketing, including without limitation, search engine optimization and social media, (d) administering regional and multi-regional advertising programs, including, without limitation, purchasing direct mail and other media advertising, (e) employing advertising, program and marketing agencies, and vendors providing marketing services, (f) development, implementation and maintenance of online asset management tools, (g) marketing and advertising training programs and materials, and (h) costs for providing promotional brochures and advertising templates and materials to HealthSource Chiropractic Clinic franchises. As available, we will provide you with digital or hard copies of our marketing materials via our intranet. We may, at our discretion, charge you for hard or digital copies of these marketing materials. You agree that the amounts you contribute to the Ad Fund may be used for placement of advertising in television, radio, newspaper or other media as solely determined by HealthSource Chiropractic.

The Ad Fund will be accounted for separately from other funds of HealthSource Chiropractic, and will not be used to defray any of our general operating expenses, except for any reasonable salaries, administrative costs, and overhead we may incur in activities reasonably related to the administration of the Ad Fund and its advertising programs (including without limitation conducting market research, preparing advertising and marketing materials, and collecting and accounting for contributions to the Ad Fund). We may spend in any fiscal year an amount greater or less than the total contributions to the Ad Fund in that year. We may cause the Ad Fund to borrow from us or other lenders to cover deficits of the Ad Fund, or to invest any surplus for future use by the Ad Fund. You authorize us to collect for remission to the Ad Fund any advertising monies or credits offered by any supplier to you based upon purchases you make. We will prepare an annual, unaudited statement of monies collected and costs incurred by the Ad Fund and will make it available to you on written request.

You understand and acknowledge that the Ad Fund will be intended to maximize recognition of the Marks and the goodwill and patronage of HealthSource Chiropractic Clinic franchises. Although we will endeavor to use the Ad Fund to develop advertising and marketing materials, and to place advertising in a manner that will benefit all HealthSource Chiropractic Clinic franchises, we undertake no obligation in developing, implementing, or administering advertising or promotional programs to ensure that expenditures by the Ad Fund in or affecting any geographic area are proportionate or equivalent to contributions to the Ad Fund by HealthSource Chiropractic Clinic franchises operating in that geographic area, or that any HealthSource Chiropractic Clinic franchise will benefit directly or in proportion to its contribution to the Ad Fund from the development of advertising and marketing materials or the placement of advertising. HealthSource Chiropractic shall not be a fiduciary to you with respect to the management of the Ad Fund. Except as expressly provided in this Paragraph, we assume no direct or indirect liability or obligation to you with respect to the maintenance, direction, or administration of the Ad Fund.

We will have the right to terminate the Ad Fund by giving you 30 days' advance written notice. All unspent monies on date of termination will be divided between HealthSource Chiropractic and the contributing HealthSource Chiropractic Clinic franchisees in proportion to our and their respective contributions. At any time thereafter, we will have the right to reinstate the Ad Fund under the same terms and conditions as described in this Paragraph (including the

rights to terminate and reinstate the Ad Fund) by giving you thirty (30) days' advance written notice of reinstatement.

In addition to the Ad Fund, as stated in Paragraph 6.3b, we may establish a program in the future to provide additional marketing services to Clinic franchises. This program will involve the placement of individuals on a local basis to perform marketing activities for your benefit, subject to applicable law. This program will be optional for Clinic franchises. If you choose to use this marketing program, you must agree to pay the fee specified in Paragraph 6.3b. If we choose to establish this program in the future, and you choose to purchase this optional program, you agree to comply with all specifications and requirements contained in the Operations Manual concerning this program.

Source: Item 23 — Receipts (FDD pages 77–282)

What This Means (2025 FDD)

According to Healthsource Chiropractic's 2025 Franchise Disclosure Document, the Ad Fund is an advertising fund that Healthsource Chiropractic may establish, maintain, and administer to support national, regional, or local marketing and promotional programs. These programs are designed to promote the goodwill and public image of HealthSource Chiropractic Clinic franchises. Franchisees are required to contribute to the Ad Fund, with the contribution amount set at two percent (2%) of the gross revenues of the franchise. These advertising fees are payable monthly, at the same time as the continuing franchise fees.

Healthsource Chiropractic has sole discretion over the advertising programs financed by the Ad Fund, including the creative concepts, materials, endorsements, and media used, as well as the geographic, market, and media placement and allocation of the programs. The Ad Fund can be used to cover various costs related to advertising and promotional activities, such as preparing and conducting media programs (television, radio, magazine, internet, etc.), marketing research, website development and marketing, administering regional advertising programs, employing advertising agencies, developing online asset management tools, and providing promotional materials to franchisees.

The Ad Fund is accounted for separately from other Healthsource Chiropractic funds and is not used for general operating expenses, except for reasonable salaries, administrative costs, and overhead related to administering the Ad Fund and its advertising programs. Healthsource Chiropractic will provide an annual, unaudited statement of monies collected and costs incurred by the Ad Fund, available to franchisees upon written request. Healthsource Chiropractic will provide franchisees with 30 days' advance notice of the establishment or termination of an Ad Fund and any change in the required contribution.

Healthsource Chiropractic does not act as a fiduciary with respect to the management of the Ad Fund. The company retains the right to terminate the Ad Fund with 30 days' written notice, and any unspent monies will be divided between Healthsource Chiropractic and the contributing franchisees in proportion to their respective contributions. Healthsource Chiropractic also has the right to reinstate the Ad Fund under the same terms and conditions with 30 days' written notice.

Disclaimer: This information is extracted from the 2025 Franchise Disclosure Document and is provided for research purposes only. It does not constitute legal or financial advice. Consult with a franchise attorney before making any investment decisions.