How is an 'Adverse Event' defined by Focus Cfo?
Focus_Cfo Franchise · 2025 FDDAnswer from 2025 FDD Document
For purposes of this Agreement, an Adverse Event is deemed to have occurred if Focus CFO determines, in its sole discretion after its review of the surrounding facts and circumstances, that one or more of the following circumstances or events applies or has occurred with respect to Franchisee: (i) Franchisee committed an act or omission constituting a felony or involving fraud, embezzlement or other
Source: Item 23 — Receipts (FDD pages 37–126)
What This Means (2025 FDD)
According to the 2025 Focus Cfo Franchise Disclosure Document, an 'Adverse Event' is defined within the context of the Franchise Agreement in Section 10.4. However, the full definition is not provided in this excerpt. The excerpt indicates that an Adverse Event occurs if Focus Cfo determines, in its sole discretion, that certain circumstances or events have occurred with respect to the franchisee. One example provided is if the franchisee committed a felony or was involved in fraud or embezzlement.
This definition is important because Focus Cfo will indemnify the franchisee for judgments, settlements, penalties, fines, or expenses incurred in a proceeding where the franchisee is a party because they are or were serving as an Area President of Focus Cfo, unless the underlying claim is a result of or related to an Adverse Event. Therefore, if an event is classified as an Adverse Event, the franchisee may not be indemnified by Focus Cfo for related expenses.
As the full definition of 'Adverse Event' is not included in this excerpt, it is important for a prospective franchisee to review Section 10.4 of the Franchise Agreement in its entirety to fully understand what constitutes an Adverse Event and what the implications are for indemnification and other aspects of the franchise relationship. A prospective franchisee should ask Focus Cfo for a complete copy of the Franchise Agreement and carefully review all sections referenced in this definition.