Under what conditions might a Healthsource Chiropractic franchisee be required to enter into a Management Agreement?
Healthsource_Chiropractic Franchise · 2025 FDDAnswer from 2025 FDD Document
- 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.
- In addition to signing the Franchise Agreement with us, before you begin operating the Clinic Management Business, you must enter into a management agreement
Source: Item 23 — Receipts (FDD pages 77–282)
What This Means (2025 FDD)
According to Healthsource Chiropractic's 2025 Franchise Disclosure Document, a franchisee may be required to enter into a Management Agreement under specific circumstances, particularly when the franchisee is not licensed to practice chiropractic care but wishes to own and operate a HealthSource Chiropractic clinic. These situations typically arise in states where laws prohibit non-licensed individuals from owning or operating chiropractic practices. In such cases, the franchisee, referred to as a "Clinic Management Business," must enter into a Management Agreement with a "PC" (Professional Corporation) that is authorized to provide chiropractic services under local and state laws.
This arrangement allows the franchisee to construct or build out the clinic, while the PC operates the clinic using the HealthSource Chiropractic name and marks. The franchisee provides management and administrative services to support the PC's chiropractic practice. The Management Agreement ensures that the clinic complies with all applicable laws and regulations regarding the provision of chiropractic services.
Healthsource Chiropractic's Franchise Disclosure Document includes a general form of Management Agreement as an exhibit, which serves as a starting point. However, the final Management Agreement must be approved by Healthsource Chiropractic and comply with all relevant state and local laws. This requirement ensures that the operation of the Healthsource Chiropractic franchise adheres to professional standards and legal requirements, especially in regions where specific regulations govern the ownership and operation of chiropractic practices.