Is the Engel & Volkers Confidentiality Agreement required for all Principals of the Franchisee?
Engel_Volkers Franchise · 2025 FDDAnswer from 2025 FDD Document
ng Franchisor with all costs associated with providing reporting information requested in connection with the security.
22.8 No Waiver of Franchisor's Rights:
Franchisor's consent to any assignment shall not constitute a waiver of any claims Franchisor may have against Franchisee, the franchised Business, Residential Real Estate Brokerages operated by Franchisee or its affiliates, any of Franchisee's owners and/or any
Guarantor. Nor shall such consent be deemed a waiver of Franchisor's right to require exact compliance with any of the terms of this Agreement by any assignee.
23. Multiple Owner and Business Entity Franchisee
- 23.1 Guarantee: If Franchisee is a business entity, e.g., corporation, partnership or limited liability company, Franchisee's principal owners must be named in Appendix 5 (hereinafter called the "Principals"). A Principal is an "owner" that owns ten percent (10%) or more of Franchisee. The Principals will each sign the Principal's Guarantee and Assumption of Obligations attached as Appendix 4 to this Agreement.
Source: Item 22 — CONTRACTS (FDD page 88)
What This Means (2025 FDD)
According to Engel & Volkers's 2025 Franchise Disclosure Document, if the franchisee is a business entity, the principal owners, defined as those owning 10% or more of the franchisee, must be listed in Appendix 5. These individuals, referred to as Principals, are required to sign the Principal's Guarantee and Assumption of Obligations, which is attached as Appendix 4 to the Franchise Agreement.
Furthermore, Engel & Volkers requires franchisees to ensure that their shareholders, partners, members, officers, directors, managers, staff members, and Sales Advisors execute Engel & Volkers's form of Confidentiality Agreement and Covenant Not to Compete. This indicates that while the Principal's Guarantee is mandatory for principal owners, a separate Confidentiality Agreement is also required for a broader group of individuals associated with the franchisee.
In summary, Engel & Volkers requires specific actions from Principals, including signing a guarantee. Additionally, a broader confidentiality agreement must be signed by a wider range of individuals connected to the franchisee, including Principals, staff, and sales advisors. This ensures comprehensive protection of Engel & Volkers's confidential information and trade secrets.