Does the Franchise Agreement for Counselor Realty define the term 'System'?
Counselor_Realty Franchise · 2025 FDDAnswer from 2025 FDD Document
alified license to use them in strict conformity with this Agreement;
(c) We may change the System and the Marks periodically, and when we do, you must promptly conform the Business to the revised requirements, at your cost;
(d) You shall not directly or indirectly sublicense, delegate or transfer any of the rights licensed by this Agreement except in accordance with Article 9;
(e) We and our affiliates may conduct various business activities, including residential and commercial real estate brokerage businesses; and
(f) You acknowledge that the System was developed by us at considerable expense and investment and that your operation of a "Counselor" franchise is possible only with our assistance and ongoing advisory services. You agree that the disclosure or unauthorized or improper use of the System may cause Counselor or other franchisees irreparable harm, and you agree not to engage in such practices.
3. TERM.
- 3.1 Term. The initial term of this Agreement begins on the Effective Date of this Agreement and ends five years from the Effective Date.
- 3.2 Successor Franchise.
Source: Item 22 — CONTRACTS (FDD page 32)
What This Means (2025 FDD)
According to the 2025 Counselor Realty Franchise Disclosure Document, the term 'System' is referenced within the agreement but not explicitly defined. The agreement mentions that Counselor Realty may change the System periodically, and the franchisee must conform to these revised requirements at their own cost. Additionally, the franchisee acknowledges that the System was developed by Counselor Realty at considerable expense and that unauthorized use of the System may cause irreparable harm to Counselor Realty and other franchisees.
The Franchise Agreement grants the franchisee a non-exclusive license to use the System and the Marks to operate a real estate brokerage business. Franchisees must comply with changes Counselor Realty makes to the System and standards, even if additional investment or expenditures are required.
While the term 'System' is not specifically defined, it is clear that it encompasses the methods, standards, and practices that Counselor Realty has established for operating a franchise. A prospective franchisee should seek clarification from Counselor Realty regarding the specific components of the 'System' and the potential costs associated with conforming to any future changes.