What are the obligations of a Healthsource Chiropractic franchisee upon termination or non-renewal of the franchise agreement?
Healthsource_Chiropractic Franchise · 2025 FDDAnswer from 2025 FDD Document
| Provision | Section in Franchise Agreement | Summary |
|---|---|---|
| hereunder in any respect, then all | ||
| rights granted to you under the | ||
| Franchise | ||
| Agreement | ||
| shall | ||
| immediately | ||
| and | ||
| automatically | ||
| terminate and revert to us without | ||
| further notice to you or action on our | ||
| part. | ||
| Also, | ||
| in the event, in the opinion of | ||
| our legal counsel, any provision of the | ||
| Franchise Agreement is contrary to | ||
| law and we are not able to negotiate | ||
| an | ||
| amendment | ||
| to | ||
| the | ||
| Franchise | ||
| Agreement | ||
| to | ||
| conform | ||
| to | ||
| legal | ||
| requirements upon 30 days' notice, or | ||
| the | ||
| amendment | ||
| requires | ||
| a | ||
| fundamental change to the Franchise | ||
| Agreement, we may terminate the | ||
| Franchise Agreement. | ||
| i. Your obligations on termination/ non-renewal | Section 16 | You must pay all amounts owed to us; refrain from using our Marks, return to us or destroy (as we specify) all customer lists, forms and materials bearing our Marks or relating to the franchise; de-identify the franchise premises; return the Operations Manual; comply with covenants against competition and the non solicitation, non-disparagement, and non-disclosure covenants in Section 9 of the Franchise Agreement; and cease using all confidential information. |
| You irrevocably appoint us your | ||
| attorney-in-fact- to de-identify your | ||
| franchise premises and enforce your | ||
| requirement to discontinue use of the | ||
| Marks if you do not perform these | ||
| obligations within 10 days of the | ||
| termination of your Agreement. | ||
| You | ||
| must | ||
| also | ||
| (1) | ||
| execute | ||
| any | ||
| documents | ||
| and | ||
| take | ||
| any | ||
| steps | ||
| necessary to delete your listings from | ||
| classified | ||
| telephone | ||
| directories, | ||
| disconnect, or, at our option, assign to | ||
| us all telephone numbers that have |
Source: Item 17 — Renewal, Termination, Transfer, and Dispute Resolution (FDD pages 53–64)
What This Means (2025 FDD)
According to Healthsource Chiropractic's 2025 Franchise Disclosure Document, upon termination or non-renewal of the franchise agreement, a franchisee has several obligations as outlined in Section 16 of the Franchise Agreement. These include paying all outstanding amounts owed to Healthsource Chiropractic. The franchisee must also stop using Healthsource Chiropractic's trademarks (Marks) and either return or destroy, according to Healthsource Chiropractic's instructions, all customer lists, forms, and materials that bear the company's Marks or relate to the franchise.
Additionally, the franchisee is required to de-identify the franchise premises, meaning they must remove any branding or signage that identifies it as a Healthsource Chiropractic location. The Operations Manual must be returned to Healthsource Chiropractic. The franchisee must also adhere to the non-competition, non-solicitation, non-disparagement, and non-disclosure covenants as detailed in Section 9 of the Franchise Agreement, and cease using any confidential information.
Healthsource Chiropractic also has the power of attorney to de-identify the franchise premises and enforce the discontinuation of the use of their Marks if the franchisee fails to meet these obligations within 10 days of termination. Furthermore, the franchisee must execute documents and take necessary steps to delete their listings from classified telephone directories and disconnect or assign to Healthsource Chiropractic all telephone numbers associated with the franchise.