What happens to the Engel & Volkers Administrative Location Addendum if the Franchise Agreement is terminated or expires?
Engel_Volkers Franchise · 2025 FDDAnswer from 2025 FDD Document
- 5.3 Franchisee agrees and acknowledges, that the operation of the Administration Location is contingent upon Franchisee's continued compliance in operating its franchised Business in accordance with the terms and conditions of the FA. If the FA is terminated or expires,
for any reason, this Administrative Location Addendum shall automatically terminate. Furthermore, if Franchisee fails to comply with the terms and conditions of this Administrative Location Addendum, such default will constitute a default under the FA and any other agreement between Franchisor and Franchise, and Franchisor, in its sole discretion, may terminate this Administrative Location Addendum, the FA and any other agreement between Franchisor and Franchisee.
Source: Item 22 — CONTRACTS (FDD page 88)
What This Means (2025 FDD)
According to Engel & Volkers' 2025 Franchise Disclosure Document, the Administrative Location Addendum is directly tied to the Franchise Agreement. Specifically, if the Franchise Agreement is terminated or expires for any reason, the Administrative Location Addendum will automatically terminate. This means the franchisee's right to operate the administrative location ceases at the same time as the franchise agreement.
Engel & Volkers emphasizes that the operation of the Administrative Location is contingent upon the franchisee's continued compliance in operating its franchised business according to the Franchise Agreement's terms. Therefore, any failure to comply with the Franchise Agreement's terms not only constitutes a default under the Franchise Agreement but also allows Engel & Volkers, at its sole discretion, to terminate the Administrative Location Addendum, the Franchise Agreement, and any other agreements between Engel & Volkers and the franchisee.
This clause ensures that Engel & Volkers maintains control over its brand and standards. It prevents a franchisee whose main agreement has ended from continuing to operate an administrative location that could potentially damage the brand's reputation or create confusion in the market. Prospective franchisees should understand that the Administrative Location Addendum is not a standalone agreement and is entirely dependent on the active and compliant operation of the primary Engel & Volkers franchise.