Which exhibit outlines the agreement terms for transferring a Healthsource Chiropractic franchise?
Healthsource_Chiropractic Franchise · 2025 FDDAnswer from 2025 FDD Document
zed and have all licenses necessary to perform the services offered by the Franchise. The Proposed New Owner shall be responsible for any wages and compensation owed to, and the travel and living expenses (if the Initial Training program is not held virtually in the future, and including all transportation costs, room, board and meals) incurred by, the attendees who attend the Initial Training program;
- d. if your lease for the Premises requires it, the lessor must have consented to the assignment of the lease of the Premises to the Proposed New Owner;
- e. you must pay us a non-refundable Transfer fee in the amount of $10,000.00 concurrently with the execution of the Transfer Agreement, described in Section 14.5f below, and you must reimburse us for any reasonable expenses incurred by us in investigating and processing any Proposed New Owner where the Transfer is not consummated for any reason;
- f. you and your Principal Owners must execute a Transfer Agreement, which will include (i) a general release (in a form satisfactory to us) of any and all claims you and/or they may have against us, our affiliates, and our and our affiliates' respective officers, directors, employees, and agents, and (ii) acknowledgment that the restrictive covenants set forth in Article 9 of this Agreement will survive the Transfer to the extent set forth therein;
- g. we must approve the material terms and conditions of the proposed Transfer, including without limitation that the price and terms of payment are not so burdensome as to adversely affect the operation of the Franchise;
- h. the Franchise and the Premises shall have been placed in an attractive, neat and sanitary condition.
- i. you and your Principal Owners must enter into an agreement with us providing that all obligations of the Proposed New Owner to make installment payments of the purchase price (and any interest on it) to you or your Principal Owners will be subordinate to the obligations of the Proposed New Owner to pay any amounts payable under this Agreement or any new Franchise Agreement that we may require the Proposed New Owner to sign in connection with the Transfer, and containing a general release of any claims that you may have against us.
- j. the Franchise shall have been determined by us to contain all equipment and fixtures in good working condition, as were required at the initial opening of the F
Source: Item 23 — Receipts (FDD pages 77–282)
What This Means (2025 FDD)
According to Healthsource Chiropractic's 2025 Franchise Disclosure Document, Section 14.5(f) of the franchise agreement outlines that a franchisee and their Principal Owners must execute a Transfer Agreement when transferring ownership. This agreement includes a general release of claims against Healthsource Chiropractic and its affiliates, as well as an acknowledgment that the restrictive covenants in Article 9 of the agreement will continue to apply after the transfer.
Additionally, the franchisee is required to pay a non-refundable transfer fee of $10,000.00 upon execution of the Transfer Agreement. They must also reimburse Healthsource Chiropractic for any reasonable expenses incurred during the investigation and processing of the proposed new owner, especially if the transfer is not completed. The franchisor retains the right to approve the material terms of the proposed transfer, ensuring that the price and payment terms do not negatively impact the franchise's operation.
Furthermore, several conditions must be met for the transfer to be approved. These include ensuring the franchise and premises are in good condition, obtaining the lessor's consent for lease assignment if required, and ensuring that the new owner agrees to make necessary capital expenditures to meet Healthsource Chiropractic's standards. The agreement also stipulates that any installment payments from the new owner to the previous owner must be subordinate to the new owner's obligations to Healthsource Chiropractic.