What happens if Healthsource Chiropractic and I do not sign a Franchise Agreement?
Healthsource_Chiropractic Franchise · 2025 FDDAnswer from 2025 FDD Document
b. From time to time we grant to persons who meet our qualifications, franchises to own and operate a HealthSource Chiropractic Clinic in accordance with the System in a specified geographic territory. This Agreement is being presented to you because of the desire you have expressed to obtain the right to develop, own, and be franchised to operate a HealthSource Chiropractic Clinic (we refer to your HealthSource Chiropractic franchise hereinafter as the "Franchise" or the "Franchised Business"). You may purchase and operate your Franchise as a new, start-up Clinic (a "Start-up Clinic"), or may convert an existing chiropractic practice to a HealthSource Chiropractic Clinic (a "Conversion Clinic").
- c. In certain cases, where permitted by law, we may offer franchises to persons or legal entities that meet our qualifications but are not licensed to practice or provide chiropractic care, and are willing to undertake the investment and effort to own and operate a business that will manage a Start-Up or Conversion Clinic under the System; we refer to these businesses as "Clinic Management Businesses." For example, certain states do not permit non-licensed persons to own and/or operate chiropractic practices, but some states do. In states that do not permit non-licensed persons to own or operate chiropractic practices, a Clinic Management Business may be offered. In states that do permit non-licensed persons to own and operate chiropractic practices, a Clinic Management Business Franchise is not necessary, but may be offered by us under certain circumstances.
As further described below, to operate a Clinic Management Business, you must enter into a Franchise Agreement with us and a Management Agreement with a "PC" that will own and operate the Clinic. A "PC" will be one or more licensed individuals, or a professional corporation or similar entity, such as a professional limited liability company, that is duly authorized to provide chiropractic services under local and state laws. In such an arrangement:
- You, as franchisee, will construct or build-out the Clinic for use by the PC.
- The Clinic business will be operated by the PC using the HealthSource name and Marks.
- In addition to signing the Franchise Agreement with us, before you begin operating the Clinic Management Business, you must enter into a management agreement
Source: Item 23 — Receipts (FDD pages 77–282)
What This Means (2025 FDD)
The 2025 Healthsource Chiropractic Franchise Disclosure Document does not explicitly state the consequences of not signing a Franchise Agreement after expressing initial interest. However, it does outline the process and requirements for being granted a franchise.
According to the FDD, Healthsource Chiropractic grants franchises to individuals who meet their qualifications to own and operate a HealthSource Chiropractic Clinic. The agreement is presented because of the expressed desire to obtain the right to develop, own, and operate a Healthsource Chiropractic Clinic. The document states that the franchise allows the operation of a clinic offering all products, services, and proprietary programs in accordance with the System.
To operate a Clinic Management Business, a franchisee must enter into a Franchise Agreement with Healthsource Chiropractic and a Management Agreement with a "PC" (one or more licensed individuals or a professional corporation authorized to provide chiropractic services). The franchisee will construct or build out the Clinic for use by the PC, and the Clinic business will be operated by the PC using the Healthsource name and Marks.
Since the document does not specify what happens if the Franchise Agreement is not signed, it is important for a prospective franchisee to ask Healthsource Chiropractic directly about the implications of not signing the agreement after expressing interest and potentially incurring costs related to site selection or other preliminary steps. Understanding these implications is crucial before investing time and resources into the franchise opportunity.