factual

For how long after termination or expiration of my relationship with Focalpoint Coaching must I refrain from involvement with a Competitive Business?

Focalpoint_Coaching Franchise · 2025 FDD

Answer from 2025 FDD Document

eement with Company). Despite the foregoing definition of a Competitive Business, nothing under this Agreement or the Franchise Agreement will prevent Individual from owning for investment purposes less than two percent (2%) of a Competitive Business whose stock or other forms of ownership interest are publicly traded on a recognized United States stock exchange, and so long as neither Individual nor Franchisee controls the company in question.

Upon the expiration or other termination for any reason of my employment, association, service or ownership participation, I agree:

  • (i) to return immediately to Company or Franchisee, as the case may be, all Confidential Information, and any material(s) containing a subset thereof, in my possession that was utilized, or to which I had access, during my employment, association, service or ownership participation;
  • (ii) to refrain, beginning upon such expiration or termination and forever thereafter, from any and all contacts with clients of FocalPoint Franchised Businesses for any purpose whatsoever; and
  • (iii) for a period of two (2) years, starting on the effective date of termination or expiration of my employment/service/association or ownership participation, to refrain from directly or indirectly (such as through any one or more of my spouse, legally-recognized domestic partner, parents, children or sibling(s) (collectively, "Immediate Family")) owning a legal or beneficial interest in, or rendering services or giving advice to: any Competitive Business operating (a) at the premises where the Office is located; (b) within the Territory; (c) within a twenty-

five (25)-mile radius of the Territory; (d) within the territory of any FocalPoint Franchised Business in operation or under construction on the effective date of termination or expiration of my employment/service/association/ ownership participation; or (e) any entity which grants franchises, licenses or other interests to others to operate any Competitive Business.

I acknowledge and understand that the provisions of this Agreement, including my representations, covenants, and warranties (as applicable) given hereunder, are necessary and integral to this Agreement and to Company's and Franchisee's interests under the Franchise Agreement, and are intended to:

  • (i) preclude not only direct competition, but also all forms of indirect competition, such as consultation for Competitive Businesses, service as an independent contractor for Competitive Businesses, or any assistance or transmission of information of any kind which would be of any material assistance to a competitor;
  • (ii) bind any person or entity having any legal or beneficial interest in me, or traceable to, down or through me, including (without limitation) any of member of my Immediate Family, any direct or indirect beneficiary, any partner (general or limited) or proprietor of mine, and any other such related person or entity, regardless of how many levels or tiers there may be between any such described person or entity and me; and
  • (iii) identify for me, toward the goal of preserving through this Agreement, Company's protectable legal interests in the System, clients of FocalPoint Franchised Businesses, the Confidential Information, and the goodwill associated with the Marks.

I also expressly acknowledge my possession of skills and abilities of a general nature, and the opportunity for exploiting such skills in other ways than the operation or involvement in the activities of a FocalPoint Franchised Business or a Competitive Business, so that enforcement of my covenants made in this Agreement will not deprive me of my personal goodwill or ability to earn a living after the effective date of expiration or termination of my relationship with Franchisee, the Business, or FocalPoint Franchised Businesses generally. If I fail or refuse to abide by any of my foregoing obligations or promises made under this Agreement, and Company or Franchisee obtains enforcement in a judicial or arbitration proceeding, then my obligations and responsibilities specified under the breached covenant will be tolled during the period(s) of time that the covenant is breached and/or Company or Franchisee seeks to enforce it, and will continue for two (2) years starting from the effective date of the order enforcing the covenant.

I acknowledge that violation of the covenants not to compete contained in this Agreement would result in immediate and irreparable injury to Company and Franchisee, for which no adequate remedy at law will be available. Accordingly, I hereby consent to the entry of an injunction procured by Company or Franchisee (or both), in any appropriate jurisdiction and venue (notwithstanding other references to resolution of actions exclusively in Company's home prohibiting any conduct by me in violation of the

**terms of those covenants not to compete and/or restrictions on the use of Confidential Information under this Agreement. I expressly agree that it may conclusively be presumed in any legal action that any violation of the terms of these covenants not to compete was accomplished by and through my unlawful utilization of Company's Confidential Information. Further, I expressly agree that any claims I may have against Company will not constitute a defense to Company's enforcement of the covenants not to compete under this Agreement.

Source: Item 22 — Contracts (FDD pages 56–57)

What This Means (2025 FDD)

According to Focalpoint Coaching's 2025 Franchise Disclosure Document, franchisees face a two-year restriction on involvement with any Competitive Business following the termination or expiration of their franchise agreement. This restriction begins on the effective date of the termination or expiration of their employment, service, association, or ownership participation. This covenant not to compete extends to owning a legal or beneficial interest in, or rendering services or giving advice to, a Competitive Business.

The definition of a Competitive Business includes any business deriving more than 20% of its revenue from selling business training or consulting services, or granting franchises or licenses to others for similar businesses. The restrictions apply to businesses operating at the former Focalpoint Coaching office location, within the franchisee's territory, within a 25-mile radius of the territory, or within the territory of any other Focalpoint Coaching franchise in operation or under construction at the time of termination. The agreement also extends to any entity that grants franchises or licenses to others to operate any Competitive Business.

This non-compete agreement also extends to the franchisee's Immediate Family, which includes a spouse, legally-recognized domestic partner, parents, children, or siblings. The FDD specifies that the restrictions aim to prevent both direct and indirect competition, including consultation or service as an independent contractor for Competitive Businesses. If a franchisee breaches this covenant and Focalpoint Coaching seeks enforcement through legal proceedings, the duration of the restriction will be tolled during the period of the breach and will continue for two years from the date of the enforcement order.

However, the agreement does allow for franchisees to own less than 2% of a Competitive Business for investment purposes, provided that the stock is publicly traded on a recognized United States stock exchange and neither the franchisee nor their affiliated business controls the company. This exception provides a limited avenue for investment without violating the non-compete obligations. Franchisees should carefully consider these restrictions and their potential impact on future business opportunities before entering into a franchise agreement with Focalpoint Coaching.

Disclaimer: This information is extracted from the 2025 Franchise Disclosure Document and is provided for research purposes only. It does not constitute legal or financial advice. Consult with a franchise attorney before making any investment decisions.