What is the 'Initial Clinic' as defined in the Healthsource Chiropractic development agreement?
Healthsource_Chiropractic Franchise · 2025 FDDAnswer from 2025 FDD Document
and other commercial symbols, including the marks "HealthSource Chiropractic," "HS," and "America's Chiropractor" and certain associated designs, artwork and logos, which we may change or add to from time to time (the "Marks").
- 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.
Source: Item 23 — Receipts (FDD pages 77–282)
What This Means (2025 FDD)
According to Healthsource Chiropractic's 2025 Franchise Disclosure Document, the franchise agreement is presented to individuals desiring the right to develop, own, and operate a HealthSource Chiropractic Clinic. This franchise is referred to as the "Franchise" or the "Franchised Business." A franchisee can establish their franchise as either a new, start-up clinic (referred to as a "Start-up Clinic") or by converting an existing chiropractic practice into a HealthSource Chiropractic Clinic (referred to as a "Conversion Clinic").
In certain instances, Healthsource Chiropractic may offer franchises to individuals or entities that meet their qualifications but are not licensed to practice chiropractic care. These individuals must be willing to invest in and manage a Start-Up or Conversion Clinic under the Healthsource Chiropractic system; these businesses are referred to as "Clinic Management Businesses." The availability of Clinic Management Businesses depends on state laws, as some states do not permit non-licensed individuals to own or operate chiropractic practices.
To operate a Clinic Management Business, a franchisee must enter into a Franchise Agreement with Healthsource Chiropractic and a Management Agreement with a "PC" (Professional Corporation) that will own and operate the clinic. The PC consists of licensed individuals or a professional corporation authorized to provide chiropractic services under local and state laws. In this arrangement, the franchisee is responsible for constructing or building out the Clinic for use by the PC, and the Clinic business is operated by the PC using the HealthSource name and Marks.