Does Focus CFO have the right to modify the Compensation Policy as outlined in the Franchise Agreement?
Focus_Cfo Franchise · 2025 FDDAnswer from 2025 FDD Document
ATTACHMENT B TO THE FRANCHISE AGREEMENT
COMPENSATION POLICY (EFFECTIVE AS OF January 1, 2025)
Focus CFO has the right to modify the provisions of this Compensation Policy as set forth in your Franchise Agreement.
- 8.1. Focus CFO shall pay Franchisee as an independent contractor according to the current Compensation Policy. The Compensation Policy is adopted by Focus CFO management. The current Compensation Policy is attached as Attachment B. Focus CFO has the right to modify the Compensation Policy by providing Franchisee with at least thirty (30) days' prior notice. However, Focus CFO cannot adjust each individual percentage rate set forth in the then-current Compensation Policy by more than one individual percentage point per year without Franchisee's prior written consent. See Attachment B for examples.
- H. Focus CFO has the right to modify the Compensation Policy as set forth in the Franchise Agreement executed by the Area President, however, Focus CFO cannot adjust each individual percentage rate set forth in the Compensation Policy by more than one individual percentage point per year without Franchisee's prior written consent. For example, in a given year, the tiered rates of the Area President compensation scale can be reduced from 35% to 34%, 30% to 29%, 25% to 24% and 20% to 19%, and the 5% reduction for corporate website leads can be increased to 6%, and the 10% reduction for CSLG's can be increased to 11%.
Source: Item 23 — Receipts (FDD pages 37–126)
What This Means (2025 FDD)
According to the 2025 Focus Cfo Franchise Disclosure Document, Focus Cfo has the right to modify the Compensation Policy as outlined in the Franchise Agreement. Attachment B to the Franchise Agreement specifically addresses the Compensation Policy, stating that Focus Cfo can modify the provisions set forth in the agreement.
However, there are limitations to Focus Cfo's ability to make changes. While Focus Cfo can modify the Compensation Policy, they cannot adjust each individual percentage rate within the policy by more than one percentage point per year without the franchisee's prior written consent. For example, the tiered rates of the Area President compensation scale can be reduced from 35% to 34%, 30% to 29%, 25% to 24% and 20% to 19%, and the 5% reduction for corporate website leads can be increased to 6%, and the 10% reduction for CSLG's can be increased to 11%.
Additionally, Focus Cfo must provide the franchisee with at least thirty (30) days' prior notice before implementing any modifications to the Compensation Policy. This notice period allows the franchisee time to understand the changes and how they may impact their compensation. This ensures that franchisees are informed of any adjustments to their compensation structure and have some level of protection against drastic, unilateral changes.
This policy is typical in franchising, where the franchisor needs flexibility to adapt to market conditions, but it also provides franchisees with some predictability and protection regarding their earnings. Franchisees should carefully review Attachment B and Section 8.1 of the Franchise Agreement to fully understand the Compensation Policy and the extent to which Focus Cfo can modify it.