What is the Engel & Volkers franchisee representing regarding their ability to comply with the terms of the franchise agreement?
Engel_Volkers Franchise · 2025 FDDAnswer from 2025 FDD Document
24.3 Franchisee's execution, delivery and performance of this Agreement does not violate or constitute a breach under any agreement or commitment of Franchisee;
24.4 If Franchisee is an entity, Franchisee is duly organized and validly existing, is qualified to do business in each state where Franchisee is or will conduct business, and is duly authorized to execute and deliver this Agreement and perform Franchisee's obligations pursuant to this Agreement; Franchisee does not have any material liabilities, adverse claims, commitments or obligations of any nature as of the date of execution of this Agreement, whether accrued, unliquidated, absolute, contingent or otherwise which are not reflected as liabilities on the balance sheets of Franchisee's current financial statements, which financial statements Franchisee will have furnished to Franchisor prior to the execution of this Agreement;
24.5 As of the date of execution of this Agreement, there are no actions, suits, proceedings or investigations pending or, to the knowledge of Franchisee or any of its officers, directors, or principal shareholders (after due inquiry), threatened, in any court or arbitral forum, or before any governmental agency or instrumentality, nor to the best of the knowledge of Franchisee or any such officers, directors and principal shareholders (after due inquiry) is there any basis for any claim, action, suit, proceeding or investigation which affects or could affect, directly or indirectly, any of the assets, properties, rights or business of Franchisee; the right of Franchisee to operate and use its assets, properties or rights to carry on its business; and/or which affects or could affect Franchisee's right to assume and carry out in all respects the duties, obligations and responsibilities specified in this Agreement; and
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 Engel & Volkers's 2025 Franchise Disclosure Document, each principal of the franchise represents that they are capable of complying with all the terms of the franchise agreement and the Principal's Guarantee and Assumption of Obligations. Additionally, the franchisee represents that their execution, delivery, and performance of the agreement does not violate or constitute a breach under any agreement or commitment they have. This indicates that the franchisee is affirming they have the legal and practical ability to fulfill their obligations under the Engel & Volkers franchise agreement without conflicting with other existing commitments.
Furthermore, if the franchisee is an entity, they confirm they are duly organized, validly existing, and qualified to conduct business in each state where they operate. They also state they are authorized to execute and deliver the agreement and perform their obligations. The franchisee also represents that they do not have any material liabilities, adverse claims, commitments, or obligations that are not reflected on their current financial statements provided to Engel & Volkers.
Engel & Volkers requires these representations to ensure that franchisees are entering the agreement in good faith and have the capacity to meet the financial and operational demands of the franchise. These representations are crucial for Engel & Volkers to assess the franchisee's suitability and minimize potential legal or financial risks. The franchisee's representations and warranties survive any termination or expiration of the agreement, meaning that Engel & Volkers can still hold the franchisee accountable for any misrepresentations made during the term of the agreement, even after it ends.