In the event of early termination of a Focalpoint Coaching franchise agreement, is the franchisee responsible for lost opportunities?
Focalpoint_Coaching Franchise · 2025 FDDAnswer from 2025 FDD Document
- (2) If this Agreement is terminated by Franchisee before the Term expires pursuant to Subsections 14.B, 14.D, or 14.E above, then Franchisee acknowledges and confirms that Franchisor will suffer and incur substantial damages because this Agreement did not continue for the Term's full length. Accordingly, Franchisee agrees to pay Franchisor for all damages, costs, expenses, attorneys' and experts' fees directly or indirectly related thereto, including, without limitation, lost Royalties, lost profits, loss of goodwill and damage to the Marks and reputation, lost opportunities, travel and personnel costs, expenses that Franchisor may incur in developing or finding another franchise owner to establish and operate a new FocalPoint Franchised Business in the Territory, and any other lost payments or benefits Franchisor would have received for the balance of the Term after the effective date of termination (collectively, "Brand Damages"). Franchisee further acknowledges and agrees that its obligation to pay Brand Damages resulting from early termination shall be in addition to (not in lieu of) Franchisee's posttermination obligations to pay other amounts due as of the date of termination (as contemplated under the preceding Subsection (1) above) and to otherwise comply with the entirety of Section 15 hereof, and that the Brand Damages shall not be deemed a
Source: Item 22 — Contracts (FDD pages 56–57)
What This Means (2025 FDD)
According to Focalpoint Coaching's 2025 Franchise Disclosure Document, if the franchisee terminates the agreement before the end of its term, they are responsible for damages incurred by Focalpoint Coaching. These damages include, but are not limited to, lost opportunities.
Specifically, the franchisee acknowledges that Focalpoint Coaching will suffer substantial damages if the agreement is terminated early. The franchisee agrees to compensate Focalpoint Coaching for all damages, costs, and expenses, including attorney's fees, related to the early termination. This includes lost royalties, lost profits, loss of goodwill, damage to the brand's reputation, lost opportunities, travel and personnel costs, and expenses incurred in finding a new franchisee.
The FDD emphasizes that these "Brand Damages" are not a penalty for early termination. Instead, they are considered reasonable compensation to Focalpoint Coaching for the franchisee's failure to fulfill the agreement for the remainder of the term. The franchisee's obligation to pay these damages is in addition to any other amounts owed as of the termination date and compliance with other post-termination obligations outlined in the agreement.