Which sections of the Healthsource Chiropractic Franchise Agreement address non-solicitation, non-disparagement, and non-disclosure covenants?
Healthsource_Chiropractic Franchise · 2025 FDDAnswer from 2025 FDD Document
our actions taken relating to the enforcement of this Agreement, and/or (6) your breach of any provision of this Agreement.**
e. The allocation of responsibility and your indemnification obligations described above will continue in full force and effect after, and notwithstanding, the expiration, renewal or termination of this Agreement.
9. CONFIDENTIAL INFORMATION; NON-COMPETITION; OTHER COVENANTS.
9.1 Types of Confidential Information. We possess certain unique confidential and proprietary information and trade secrets consisting of the following categories of information, methods, techniques, products, services and knowledge developed by us, including but not limited to: (a) services and products offered and sold at HealthSource Chiropractic franchises; (b) knowledge of sales and profit performance of any one or more HealthSource Chiropractic franchises; (c) knowledge of sources of products sold at HealthSource Chiropractic franchises, (d) advertising and promotional programs and image and decor; (e) methods, techniques, formats, specifications, procedures, information, systems, and knowledge of, and experience in, the development, operation, and franchising of HealthSource Chiropractic franchises; (f) copyrighted materials, including, without limitation, office forms and procedures, marketing materials, telephone scripts and the content of the Operations Manual; and (g) the methods of training employees. We will disclose much of the above-described information to you in advising you about site selection, providing our Initial Training, providing access to the Operations Manual, and providing guidance and assistance to you under this Agreement. In addition, in the course of the operation of your Franchise, you or your employees may develop ideas, concepts, methods, or techniques of improvement relating to the Franchise that you agree to disclose to us, and that we may then authorize you to use in the operation of your Franchise, and may use or authorize others to use in other HealthSource Chiropractic franchises owned or franchised by us or our affiliates. (All of such information disclosed to or developed by you will be referred to in this Agreement as our "Confidential Information".)
9.2 Non-Disclosure Agreement.
- a. You agree that your relationship with us does not vest in you any interest in the Confidential Information, other than the right to use it solely in the development and operation of the Franchise during the Term of this Agreement, and that the use or duplication of the Confidential Information in any other business or for any other purpose would constitute an unfair method of competition or otherwise result in irreparable damage to us.
- b. You acknowledge and agree that the Confidential Information belongs to us, may contain trade secrets belonging to us, and is disclosed to you or authorized for your use solely on the condition that you agree, and you therefore do agree, that you (1) will not use, directly or indirectly, the Confidential Information in any business or capacity or for any purpose other than as needed in the development and operation of the Franchise during the Term of this Agreement; (2) will maintain the absolute confidentiality of the Confidential Information during and after the Term of this Agreement and not directly or indirectly publish or otherwise disclose it to any third party; (3) will not make unauthorized copies of any portion of the Confidential Information disclosed in written form or another form or media that may be copied or duplicated; and (4) will adopt and implement all reasonable procedures, including any that we may prescribe from time to time, to prevent unauthorized use or disclosure of the Confidential Information, including without limitation restrictions on disclosure to or by your employees, and the use of non-disclosure, nonsolicitation, non-disparagement and non-competition agreements we may prescribe or approve for your shareholders, partners, members, officers, directors, employees, independent contractors, or agents who may have access to the Confidential Information. You acknowledge and agree that we are under no duty or obligation to you to enforce any such Agreements for your or our benefit. Your duties and obligations with respect to Confidential Information shall survive the Transfer, termination or expiration of this Agreement.
9.3 Non-Competition Agreement and Other Restrictive Covenants.
a. Non-Competition.
Source: Item 9 — Franchisee's Obligations (FDD pages 32–34)
What This Means (2025 FDD)
According to the 2025 Healthsource Chiropractic Franchise Disclosure Document, several sections within the agreement outline non-solicitation, non-disparagement, and non-disclosure covenants. Section 9.2 generally addresses non-disclosure agreements related to confidential information. Section 9.3 details non-competition agreements and other restrictive covenants that include non-solicitation and non-disparagement clauses. Additionally, Item 17(x) and 17(y) are referenced in Item 15 as containing non-disparagement and non-solicitation covenants applicable to general managers.
Specifically, Section 9.3(b) states that franchisees agree not to make negative or critical statements about Healthsource Chiropractic, its franchisees, or their business practices. Section 9.3(c) restricts franchisees from soliciting patients or interfering with Healthsource Chiropractic's relationships with franchisees, vendors, or referral sources for two years after the agreement's termination. These obligations extend not only to the franchisee but also to their principal owners and immediate family members.
Item 15 indicates that if a Healthsource Chiropractic franchisee employs a general manager, that manager must also sign an agreement to maintain confidentiality and adhere to non-compete, non-disparagement, and non-solicitation covenants. This ensures that key personnel are bound by similar restrictions as the franchisee. Section 16.4 further reinforces the non-disclosure agreement, stating that upon termination or expiration of the franchise, the franchisee must cease using any confidential information and return all copies of the operations manual and confidential materials. These covenants are designed to protect Healthsource Chiropractic's business interests and maintain its reputation.
These provisions are typical in franchise agreements to protect the franchisor's brand, customer relationships, and proprietary information. Prospective Healthsource Chiropractic franchisees should carefully review these sections to understand the scope and duration of these restrictions, as they can significantly impact their activities both during and after the franchise agreement term. Franchisees should also be aware that these covenants extend to their family members and employees, requiring them to ensure compliance across their organization.