For how long are the non-competition and non-solicitation covenants binding on the Focalpoint Coaching franchisee if Focalpoint Coaching exercises its right of first refusal?
Focalpoint_Coaching Franchise · 2025 FDDAnswer from 2025 FDD Document
Upon the termination or expiration of this Agreement, Franchisee and Franchisee's owners agree that, for two (2) years beginning on the effective date of termination or expiration of this Agreement (or upon a transfer as provided in Subsection 12.C(12) above), whichever is later, neither Franchisee nor any of Franchisee's owners will have any direct or indirect interest (e.g., through a spouse) as an owner (whether of record, beneficially, or otherwise), investor, partner, director, officer, employee, consultant, representative, or agent in any Competitive Business (as defined in Section 7 above) located or operating:
- (i) at the premises where the Office is located;
- (ii) within the Territory;
- (iii) within a twenty-five (25) mile radius of the Territory;
- (iv) within the Territory of any other FocalPoint Franchised Business in operation or in the process of opening on the later of the effective date of the termination or expiration of this Agreement or the date on which all persons restricted by this Subsection 15.D begin to comply with this Subsection 15.D.
E. COVENANT NOT TO SOLICIT.
Upon the termination or expiration of this Agreement, Franchisee and Franchisee's owners agree that, for two (2) years beginning on the effective date of termination or expiration of this Agreement (or upon a transfer as provided in Subsection 12.C.(12) above), whichever is later, neither Franchisee nor any of Franchisee's owners, officers, directors or employees will, directly or indirectly (e.g., through a spouse), solicit, or attempt to solicit, any client of Franchisor or of any of Franchisor's affiliates, franchise owners or area representatives to discontinue the client relationship with Franchisor or with any of Franchisor's affiliates, franchise owners or area representatives. In addition, the use of Franchisor's client lists, employee files or other such Confidential Information for the purpose of soliciting is prohibited.
Source: Item 22 — Contracts (FDD pages 56–57)
What This Means (2025 FDD)
The 2025 Focalpoint Coaching Franchise Disclosure Document outlines the terms of non-competition and non-solicitation agreements that franchisees must adhere to. Upon termination or expiration of the Franchise Agreement, the franchisee and their owners are subject to these covenants for a period of two years. This two-year period begins on the effective date of the termination or expiration of the agreement, or upon a transfer as provided in Subsection 12.C(12), whichever is later.
During this restricted period, the franchisee and their owners are prohibited from having any direct or indirect interest in a Competitive Business. This includes involvement as an owner, investor, partner, director, officer, employee, consultant, representative, or agent. The restriction applies to Competitive Businesses located or operating at the premises of the Focalpoint Coaching office, within the franchisee's territory, within a 25-mile radius of the territory, or within the territory of any other Focalpoint Coaching franchise.
Additionally, the franchisee and their owners are barred from soliciting or attempting to solicit any client of Focalpoint Coaching or its affiliates to discontinue their relationship with the company. The use of Focalpoint Coaching's client lists, employee files, or other confidential information for solicitation purposes is strictly prohibited. These covenants aim to protect Focalpoint Coaching's business interests, client relationships, and proprietary information after a franchise agreement ends.