Under what conditions can either party terminate the license agreement for Focalpoint Coaching trademarks?
Focalpoint_Coaching Franchise · 2025 FDDAnswer from 2025 FDD Document
Under an Amended and Restated License Agreement between Tracy and Fraser and FocalPoint International, dated January 12, 2016, Tracy and Fraser granted to FocalPoint International an exclusive, transferable license to (i) use the Principal Mark and to sublicense them for granting further licenses to use the Principal Mark and related FocalPoint materials and intellectual property in operating FocalPoint Franchised Businesses and FocalPoint AR Businesses; and (ii) modify, adapt and create derivative works of the Principal Mark and licensed intellectual property. The license agreement requires FocalPoint International to pay Tracy and Fraser a monthly license fee during the term of the license agreement. The license agreement between Tracy and Fraser and FocalPoint International is for a term of 10 years. If FocalPoint International is not in material default of the license agreement, FocalPoint International will have the right to renew the license agreement for consecutive successor terms of 10 years each. Either party has the right to terminate the license agreement with 90 days written notice to the other party due to the other party's material breach of the license agreement, unless the other party has taken reasonable measures to cure the breach within the 90 day notice period. Tracy and Fraser may also terminate the license agreement if FocalPoint International (i) files a petition of bankruptcy, (ii) is involuntarily placed in bankruptcy proceedings, (iii) comes under control of a receiver, (iv) becomes insolvent, (v) makes assignments for the benefits of creditors of all or part of its assets, (vi) undergoes liquidation or dissolution, or (vii) is unable to pay its debts in the normal course of business. The license agreement cannot be modified without the mutual consent of both parties. If the license agreement terminates or expires, FocalPoint International's license will terminate and FocalPoint Franchised Business franchise owners and FocalPoint AR Business franchise owners will no longer have the right to use the Principal Mark and related FocalPoint materials and intellectual property. No other agreement limits FocalPoint International's right to use or license the Principal Mark.
Source: Item 13 — Trademarks (FDD pages 38–40)
What This Means (2025 FDD)
According to Focalpoint Coaching's 2025 Franchise Disclosure Document, the Amended and Restated License Agreement between Tracy and Fraser and FocalPoint International, dated January 12, 2016, outlines the conditions for trademark license termination. Either party can terminate the agreement with 90 days' written notice if the other party materially breaches the agreement, provided the breaching party doesn't reasonably cure the breach within that 90-day period. This means that if either Tracy and Fraser or FocalPoint International fails to meet their obligations under the agreement, the other party can end the agreement, but only after giving the breaching party a chance to fix the problem. This is a fairly standard clause in licensing agreements, allowing parties to protect their interests if the other party fails to uphold their end of the deal.
Additionally, Tracy and Fraser have specific rights to terminate the license agreement if FocalPoint International faces severe financial distress. These conditions include FocalPoint International (i) filing for bankruptcy, (ii) being involuntarily placed in bankruptcy proceedings, (iii) coming under the control of a receiver, (iv) becoming insolvent, (v) making assignments for the benefits of creditors of all or part of its assets, (vi) undergoing liquidation or dissolution, or (vii) being unable to pay its debts in the normal course of business. These stipulations are designed to protect the trademarks from being associated with a financially unstable entity, which could harm the brand's reputation.
For a prospective Focalpoint Coaching franchisee, the termination of the license agreement between Tracy and Fraser and FocalPoint International has significant implications. If the license agreement is terminated or expires, FocalPoint International's license will terminate, and franchise owners will no longer have the right to use the Principal Mark and related FocalPoint materials and intellectual property. This highlights the importance of the stability and continuation of the underlying license agreement for the entire franchise system. It is crucial for potential franchisees to understand these conditions and assess the risk associated with the potential loss of trademark rights.