What factors does Focus Cfo consider when determining if an Adverse Event has occurred?
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 Focus Cfo's 2025 Franchise Disclosure Document, an Adverse Event is determined by Focus Cfo in its sole discretion. Focus Cfo will review the facts and circumstances to determine if an Adverse Event has occurred with respect to a franchisee.
Specifically, Focus Cfo will determine if the franchisee committed an act or omission constituting a felony or involving fraud, embezzlement or other similar actions. This gives Focus Cfo broad latitude to define what constitutes an Adverse Event based on their assessment of the situation.
This definition is important because Focus Cfo will indemnify a franchisee for judgments, settlements, penalties, fines or expenses incurred in a proceeding to which franchisee is a party because the franchisee is or was serving as an Area President of Focus CFO, unless the underlying claim is a result or related to an Adverse Event. Therefore, if Focus Cfo determines that an Adverse Event has occurred, the franchisee may not be indemnified.