What documents is the franchisee required to execute to establish Healthsource Chiropractic's security interest in the collateral under the Healthsource Chiropractic Agreement?
Healthsource_Chiropractic Franchise · 2025 FDDAnswer from 2025 FDD Document
To secure your performance under this Agreement and indebtedness for all sums due us or our affiliates, we shall have a lien upon, and you hereby grant us a security interest in, the following collateral and any and all additions, accessions, and substitutions to or for it and the proceeds from all of the same: (a) all inventory now owned or after-acquired by the Franchise, including but not limited to all inventory and supplies transferred to or acquired by you in connection with this Agreement; (b) all accounts of the Franchise now existing or subsequently arising, together with all interest in the Franchise, now existing or subsequently arising, together with all chattel paper, documents, and instruments relating to such accounts; (c) all contract rights of the Franchise, now existing or subsequently arising including, without limitation, accounts receivable and other contractual rights to payment from others; (d) all general intangibles of the Franchise, now owned or existing, or after-acquired or subsequently arising including, without limitation, all awards, damages, payments, escrowed monies, insurance proceeds, and interest, fees, charges or payments accruing on or received from or to be received on any of the foregoing in any way; and (e) all products, proceeds, substitutions, and replacements of any of the above described collateral.
You agree to execute such financing statements, instruments, and other documents, in a form satisfactory to us, that we deem necessary so that we may establish and maintain a valid security interest in and to these assets, and you authorize us to file, without your signature, such financing statements as we shall deem necessary or advisable to reflect the security interest granted herein.
Source: Item 23 — Receipts (FDD pages 77–282)
What This Means (2025 FDD)
According to the 2025 Healthsource Chiropractic Franchise Disclosure Document, as a franchisee, you are required to execute financing statements, instruments, and other documents that Healthsource Chiropractic deems necessary to establish and maintain a valid security interest in the assets listed as collateral. These documents must be in a form satisfactory to Healthsource Chiropractic.
Healthsource Chiropractic is granted a security interest in specific collateral to secure your performance under the Franchise Agreement and any debts you owe them or their affiliates. This collateral includes all inventory, accounts, contract rights, and general intangibles of the franchise, along with any proceeds or replacements of these items.
Furthermore, you authorize Healthsource Chiropractic to file these financing statements without requiring your signature, which allows them to efficiently establish their security interest. This means Healthsource Chiropractic can take the necessary legal steps to protect their financial stake in your franchise's assets without needing additional approvals from you for each filing. This is a fairly standard practice in franchising, as it protects the franchisor's investment in the franchisee's business.