Can Healthsource Chiropractic file financing statements without the franchisee's signature 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 Agreement, Healthsource Chiropractic has the right to file financing statements without the franchisee's signature. As part of securing the franchisee's performance and any debts owed to Healthsource Chiropractic or its affiliates, the company will hold a lien on various assets. These assets include inventory, accounts, contract rights, general intangibles, and any proceeds or replacements of these items.
To establish and maintain their security interest in these assets, Healthsource Chiropractic requires franchisees to execute financing statements, instruments, and other necessary documents in a format that is satisfactory to them. More importantly, the franchisee authorizes Healthsource Chiropractic to file these financing statements without requiring the franchisee's signature.
This clause in the agreement grants Healthsource Chiropractic significant control over securing its financial interests in the franchise. It is a fairly standard practice in franchising to ensure the franchisor has a secured interest in the franchisee's assets, especially when financing is involved. Prospective franchisees should understand that this allows Healthsource Chiropractic to act unilaterally in filing documents necessary to protect their lien position.