Is the regional setup fee waived for Focalpoint Coaching franchisees under certain conditions?
Focalpoint_Coaching Franchise · 2025 FDDAnswer from 2025 FDD Document
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- Background. We and you are parties to that certain Franchise Agreement that has been signed at the same time as the signing of this Rider (the "Franchise Agreement"). This Rider is part of the Franchise Agreement. This Rider is being signed because the Franchised Business that Franchisee will operate under the Franchise Agreement will be located in Virginia.
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- Initial Fees. The following language is added to the end of Sections 3.A and 4.A of the Franchise Agreement:
Despite the payment provisions above, we will defer payment of initial fees owed by you to us under this Agreement until all of our pre-opening obligations have been satisfied and you commence doing business 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, the payment of initial fees, which could include a regional setup fee if one exists, may be deferred under specific conditions for franchisees in certain states. Specifically, for franchisees operating in Virginia, South Dakota, or Minnesota, Focalpoint Coaching will defer the payment of initial fees until all pre-opening obligations are met and the franchisee has commenced business operations.
This deferral is outlined in riders or addenda to the standard Franchise Agreement that are applicable to these states. These riders modify sections of the Franchise Agreement related to initial fees, indicating that the standard payment provisions are superseded by the deferral agreement. This means that instead of paying the initial fees upfront, a new Focalpoint Coaching franchisee in these states would only be required to pay after the franchisor has fulfilled its pre-opening responsibilities and the franchisee has started running their business.
This arrangement could be beneficial for new franchisees as it reduces the initial financial burden and aligns the payment of fees with the commencement of business operations. It also provides a degree of assurance that the franchisee will only pay these fees once they are ready to start generating revenue. However, it is important to note that this deferral does not constitute a waiver of the fees; the franchisee is still obligated to pay them once the specified conditions are met. Prospective franchisees should carefully review the specific terms of the rider applicable to their state to fully understand the conditions and timing of these deferred payments.