Which items in the Healthsource Chiropractic Disclosure Document discuss site selection and acquisition/lease obligations?
Healthsource_Chiropractic Franchise · 2025 FDDAnswer from 2025 FDD Document
[Item 11: Franchisor's Assistance, Advertising, Computer Systems, and Training]
Item 11
FRANCHISOR'S ASSISTANCE, ADVERTISING, COMPUTER SYSTEMS, AND TRAINING
Except as listed below, we are not required to provide you with any assistance.
Pre-Opening Obligations:
Before you open your HealthSource Chiropractic Clinic for business, we or our designee will:
-
- Designate your Protected Territory (Franchise Agreement Section 2.3). See Item 12 for additional information about your Protected Territory. You may only operate a Clinic physically located in your Protected Territory.
-
- Review and approve or disapprove your proposed Clinic site (Franchise Agreement – Section 3.1). You must seek and select a mutually agreeable site within your Site Selection Area within 120 days after signing the Franchise Agreement. We will inform you of our approval or disapproval of your proposed site within 15 days of your proposal of the Clinic site. The site must meet our criteria for demographics; traffic patterns; parking; ingress and egress; character of neighborhood; competition from, proximity to, and nature of other businesses; size; appearance; and other physical and commercial characteristics. We require your Clinic to be a minimum of 1,800 square feet in size. Clinics are typically located in high-traffic strip malls. For each proposed site, you must submit to us, in the form we specify, a description of the site and any other information or materials that we may require. We will not unreasonably withhold approval of a site that meets our standards for general location and neighborhood, traffic patterns, parking size, layout, lease terms, and other physical characteristics for HealthSource Chiropractic Clinics. If you fail to identify a mutually agreeable site by the established deadline, then we may terminate your Franchise Agreement. Our approval of a proposed site is not, and should not be deemed, a judgment by us concerning the likelihood of success of a Clinic at the location, or the relative desirability of the site in comparison to other sites within the Protected Territory.
-
- If we require, approve the terms of the lease for the premises of your Clinic (Franchise Agreement – Section 3.1). You must lease the premises for the Clinic within 180 days after signing the Franchise Agreement. We may terminate your Franchise Agreement if you do not sign your lease by this deadline. Generally, we do not own premises that are leased to
[Item 12: Territory]
If you enter into a Development Agreement, provide a Development Schedule and assign a Site Selection Area for all Clinics that will be developed. The size of the Site Selection Area will likely vary among new prospects and developers, with the size of your Site Selection Area typically depending on the demographics of the area in and around the region you wish to develop.
We typically identify your initial Site Selection Area, early during the franchise due diligence and offer process, based on where you tell us you wish to operate, and the agreed-to geographic description is inserted into your Development Agreement before you sign it. The Site
Selection Area may not be modified at any time during the term of the Development Agreement unless the parties mutually agree to the modification in a separate signed writing.
Source: Item 9 — Franchisee's Obligations (FDD pages 32–34)
What This Means (2025 FDD)
According to Healthsource Chiropractic's 2025 Franchise Disclosure Document, Item 11 and Item 12 discuss site selection and acquisition/lease obligations. Item 11 outlines Healthsource Chiropractic's pre-opening obligations, including reviewing and approving the franchisee's proposed clinic site. The franchisee must find a mutually agreeable site within their Site Selection Area within 120 days of signing the Franchise Agreement, and Healthsource Chiropractic has 15 days to approve or disapprove the site. The site must meet specific criteria related to demographics, traffic, parking, neighborhood character, competition, size, and appearance, and must be a minimum of 1,800 square feet, typically in a high-traffic strip mall. The franchisee must also submit a description of the site. Healthsource Chiropractic will not unreasonably withhold approval if the site meets their standards. Failure to secure a mutually agreeable site by the deadline may result in termination of the Franchise Agreement. If required, Healthsource Chiropractic must approve the lease terms for the clinic premises, and the franchisee must lease the premises within 180 days of signing the Franchise Agreement, or the agreement may be terminated.
Item 12 mentions that if a franchisee enters into a Development Agreement, a Site Selection Area will be assigned for all clinics to be developed. The size of the Site Selection Area will vary depending on the demographics of the region the franchisee wishes to develop. Healthsource Chiropractic typically identifies the initial Site Selection Area early in the franchise process, based on the franchisee's preferred operating location, and this is included in the Development Agreement before signing. The Site Selection Area cannot be modified during the term of the Development Agreement unless both parties agree in writing.
These stipulations are typical in franchise agreements, as franchisors want to ensure brand consistency and a higher likelihood of success by controlling site selection. Franchisees should carefully consider these requirements and deadlines, as failure to meet them can lead to termination of the agreement. The franchisee bears the risk of finding and securing an appropriate location within the specified timeframe, highlighting the importance of thorough market research and planning.