What is Focalpoint Coaching's requirement regarding the transferee's character when a franchisee's owners transfer a non-controlling ownership interest?
Focalpoint_Coaching Franchise · 2025 FDDAnswer from 2025 FDD Document
If Franchisee is an entity, Franchisee's owners may transfer a non-controlling ownership interest in Franchisee or Franchisee's owners (determined as of the date on which the proposed transfer will occur) if: (1) the proposed transferee and its direct and indirect owners (if the transferee is an Entity) are of good character and otherwise meet Franchisor's then applicable standards for FocalPoint Franchised Business franchise owners (including no ownership interest in or performance of services for a Competitive Business, unless Franchisor provides prior written consent in its sole discretion); and (2) Franchisee gives Franchisor prior written notice of the transfer.
Source: Item 22 — Contracts (FDD pages 56–57)
What This Means (2025 FDD)
According to Focalpoint Coaching's 2025 Franchise Disclosure Document, if a franchisee is an entity, the franchisee's owners can transfer a non-controlling ownership interest if the proposed transferee and their owners are of good character. This is determined as of the date the proposed transfer will occur.
Specifically, the transferee must meet Focalpoint Coaching's standards for franchise owners. This includes not having an ownership interest in or performing services for a competitive business, unless Focalpoint Coaching provides prior written consent. The franchisee must also give Focalpoint Coaching prior written notice of the transfer.
This requirement ensures that even with a non-controlling interest transfer, the new owner aligns with Focalpoint Coaching's brand standards and doesn't pose a competitive threat. It also allows Focalpoint Coaching to maintain control over who is involved in their franchise system, even in a limited capacity.