What item in the Counselor Realty FDD discusses the loss of exclusive rights or termination?
Counselor_Realty Franchise · 2025 FDDAnswer from 2025 FDD Document
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Before you sign the Franchise Agreement, you and Counselor will negotiate a schedule for the minimum number of real estate sales agents who must operate from your Office. If you fail to satisfy the agreed-upon schedule, or to maintain the minimum required number of agents in the Office on an ongoing basis, you may lose the exclusive right to operate a "Counselor" office in the Territory, your Territory may be altered (as determined by Counselor in its sole discretion), or Counselor may terminate the Franchise Agreement. See below and Item 17.
You will not receive an exclusive territory. You may face competition from other franchisees or Franchisor-owned outlets, or from other channels of distribution. During the term of the Franchise Agreement, Counselor will not itself establish or operate a "Counselor" office, or license another to establish or operate a "Counselor" office within the Territory. However, both Counselor and other "Counselor" franchisees are free to enter into, and to provide residential and commercial real estate brokerage services within, your Territory, and you are free to provide real estate brokerage services in territories in which other franchisees' "Counselor" offices are located. Continuation of your rights in the Territory is contingent on your achieving and maintaining the minimum sales agent schedule agreed upon by you and Counselor, and on your payment of continuing agent fees based on that schedule. See Item 6.
Source: Item 12 — TERRITORY (FDD pages 21–23)
What This Means (2025 FDD)
According to Counselor Realty's 2025 Franchise Disclosure Document, Item 12 and Item 17 both discuss the potential loss of exclusive rights or termination of the franchise agreement. Specifically, Item 12 outlines various scenarios where a franchisee could lose their exclusive territory rights or face termination. These scenarios primarily revolve around failing to meet and maintain the minimum required number of real estate sales agents in the franchisee's office.
Item 12 states that if a franchisee fails to satisfy the agreed-upon schedule for the minimum number of real estate sales agents or fails to maintain that minimum number on an ongoing basis, Counselor Realty may take action. This action could include the loss of the exclusive right to operate a Counselor Realty office in the territory, alteration of the territory, or even termination of the Franchise Agreement. The document also mentions that continuation of rights in the territory is contingent on achieving and maintaining the minimum sales agent schedule and on the payment of continuing agent fees based on that schedule.
Furthermore, Item 12 details conditions regarding additional offices and extension offices. For extension offices, if a franchisee fails to maintain the minimum required number of sales agents, Counselor Realty may elect to have the franchisee close the extension office or terminate the Franchise Agreement. Upon renewal of the franchise, Counselor Realty may alter the territory if the population has increased beyond the maximum allowed or if the franchisee failed to maintain the minimum required number of agents during the prior term. Prospective franchisees should carefully consider these requirements and potential consequences before entering into a franchise agreement with Counselor Realty.