What does the Engel & Volkers franchise agreement state regarding its validity and binding nature on the franchisee and principals?
Engel_Volkers Franchise · 2025 FDDAnswer from 2025 FDD Document
- 24.6 This Agreement represents a valid, binding obligation of Franchisee and each Principal.
Each Principal has fully read this Agreement and Franchisor's Franchise Disclosure Document, and each Principal represents that he/she is capable of complying with all of the terms of this Agreement and the Principal's Guarantee and Assumption of Obligations.
All representations and warranties of Franchisee contained in this Agreement are complete, correct and accurate as of the date of execution of this Agreement and will survive any termination or expiration of this Agreement.
Source: Item 22 — CONTRACTS (FDD page 88)
What This Means (2025 FDD)
According to the 2025 Engel & Volkers Franchise Disclosure Document, the franchise agreement represents a valid and binding obligation for both the franchisee and any listed principals. The principals, who are owners with ten percent or more ownership in the franchisee's business entity, must also sign a guarantee and assumption of obligations, indicating their understanding and acceptance of their duties as outlined in the agreement. This acknowledgment ensures that the principals are aware of their responsibilities and are legally bound to fulfill them.
Engel & Volkers requires that the franchisee's execution, delivery, and performance of the agreement do not violate any existing agreements or commitments. If the franchisee is a business entity, it must be duly organized, validly existing, and qualified to conduct business in the relevant state. The franchisee must also be authorized to execute the agreement and fulfill its obligations. Furthermore, the franchisee must disclose any material liabilities or adverse claims in their financial statements provided to Engel & Volkers before signing the agreement.
The agreement also stipulates that there should be no pending or threatened legal actions that could affect the franchisee's assets, properties, rights, or business, or their ability to fulfill their obligations under the agreement. The franchisee confirms they have had adequate opportunity to study the Engel & Volkers system and verify the statements made by the franchisor. This confirmation underscores that the franchisee enters the agreement with a clear understanding of the business and its obligations. These provisions collectively reinforce the binding nature of the agreement and the franchisee's commitment to adhering to its terms.
Engel & Volkers also makes clear that the Engel & Völkers Group and Parent are not parties to the agreement, and the franchisee will look only to the Franchisor for performance of any obligations under the agreement. However, the Engel & Völkers Group, the Parent, E&V Marken and Grund Genug Verlag are each an intended third-party beneficiary of this Agreement.