Does the Focalpoint Coaching Nondisclosure and Non-Competition Agreement define what constitutes 'service to' the Franchisee?
Focalpoint_Coaching Franchise · 2025 FDDAnswer from 2025 FDD Document
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.
Source: Item 22 — Contracts (FDD pages 56–57)
What This Means (2025 FDD)
The 2025 Focalpoint Coaching Franchise Disclosure Document (FDD) does not explicitly define what constitutes 'service to' the Franchisee within the Nondisclosure and Non-Competition Agreement. However, the FDD does include some information regarding prohibited activities and competitive businesses.
Specifically, the agreement aims to prevent direct and indirect competition, including consultation or service as an independent contractor for competitive businesses. A "Competitive Business" is defined as any business deriving more than 20% of its revenue from selling business training or consulting services, or granting franchises/licenses for such businesses, excluding other FocalPoint Franchised Businesses. The agreement also restricts franchisees from diverting business or clients from the Franchised Business or any FocalPoint Franchised Business to a Competitive Business, or engaging in activities that could harm the goodwill of the FocalPoint Coaching brand.
While the FDD doesn't provide a specific definition of 'service to' the Franchisee, it broadly outlines activities that are considered competitive and therefore restricted. A prospective franchisee should seek clarification from Focalpoint Coaching regarding specific activities that might be considered 'service to' the Franchisee and how those activities might be impacted by the Nondisclosure and Non-Competition Agreement.