Under what condition is the Healthsource Chiropractic agreement binding on the successors and assigns of the franchisee?
Healthsource_Chiropractic Franchise · 2025 FDDAnswer from 2025 FDD Document
- 14.3 Transfer by HealthSource Chiropractic. You represent that you have not signed this Agreement in reliance on any owner, officer, or employee remaining with us in that capacity. We may change our ownership or form at any time in our sole discretion. This Agreement is fully transferable by us, without restriction, and will inure to the benefit of any person or entity to whom it is transferred, or to any other legal successor to our interests in this Agreement. After our assignment of this Agreement to a third party who expressly assumes our obligations under this Agreement, we no longer will have any performance or other obligations or liabilities under this Agreement.
Source: Item 23 — Receipts (FDD pages 77–282)
What This Means (2025 FDD)
According to the 2025 Healthsource Chiropractic Franchise Disclosure Document, the franchise agreement is fully transferable by Healthsource Chiropractic without restriction. The agreement will benefit any person or entity to whom it is transferred, or any other legal successor to Healthsource Chiropractic's interests in the agreement.
This means that Healthsource Chiropractic can transfer the agreement to another party, and that party will then have all the rights and obligations of Healthsource Chiropractic under the agreement. This is a common practice in franchising, as it allows the franchisor to sell the franchise system or merge with another company.
After Healthsource Chiropractic assigns the agreement to a third party who expressly assumes their obligations, Healthsource Chiropractic will no longer have any performance or other obligations or liabilities under the agreement. This protects the franchisee, as the new franchisor is legally bound to fulfill the original agreement terms. For a prospective franchisee, this clause offers assurance that the franchise agreement remains valid even if the Healthsource Chiropractic ownership changes.