What constitutes a material breach of the Engel & Volkers franchise agreement regarding the opening date?
Engel_Volkers Franchise · 2025 FDDAnswer from 2025 FDD Document
Failure to timely begin operation of Franchisee's Residential Real Estate Brokerage on the Opening Date is deemed a material breach of this Agreement.
If Payment Start Date occurs before the Opening Date without Franchisor's written consent, in addition to other remedies, Franchisee must pay all ongoing fees under this Agreement from the date Franchisee begins operating the Residential Real Estate Brokerage using the Trademarks and the Engel & Völkers System.
Source: Item 22 — CONTRACTS (FDD page 88)
What This Means (2025 FDD)
According to Engel & Volkers's 2025 Franchise Disclosure Document, a material breach of the franchise agreement includes failing to begin operation of the Residential Real Estate Brokerage on the specified Opening Date. This requirement underscores the importance Engel & Volkers places on franchisees commencing business promptly.
Additionally, if the Payment Start Date occurs before the Opening Date without Engel & Volkers's written consent, the franchisee must pay all ongoing fees from the date they begin operating the Residential Real Estate Brokerage using the Engel & Volkers trademarks and system. This policy ensures that Engel & Volkers is compensated for the use of its brand and system, even if the official opening is delayed.
These stipulations in the Engel & Volkers franchise agreement highlight the necessity for franchisees to adhere to the agreed-upon timelines and operational standards. Failing to meet these requirements can lead to significant financial implications and potential breach of contract, emphasizing the need for careful planning and execution by the franchisee.