What does 'Exclusivity' mean for an Engel & Volkers franchisee within their Protected Area?

According to Engel & Volkers' 2025 Franchise Disclosure Document, the term "Exclusivity" within a franchisee's Protected Area has a specific meaning. It means that Engel & Volkers will not place another Engel & Völkers Residential Real Estate Brokerage within the franchisee's designated Protected Area, as long as the franchisee remains in compliance with the terms of the Franchise Agreement. This Protected Area is defined by U.S. postal zip codes and is determined as of the Effective Date of the agreement.

However, the exclusivity does not prevent Engel & Volkers, its affiliates, or other franchisees from soliciting clients, marketing their residential real estate brokerage services, or concluding real estate transactions within the franchisee's Protected Area. This means that while another physical Engel & Volkers franchise location will not be established in the area, there is still potential for competition from other parts of the Engel & Volkers network.

It's also important to note that the Protected Area's boundaries, defined by zip codes, can be altered due to changes beyond Engel & Volkers' control, such as modifications to U.S. postal zip codes. Additionally, if a franchisee was initially granted a larger Protected Area with the expectation of operating multiple locations but fails to do so, Engel & Volkers reserves the right to reduce the Protected Area to reflect the actual number of operational locations. This condition emphasizes the importance of meeting the agreed-upon development schedule to maintain the initially granted territory.