Where are the non-competition obligations of the franchisee and Principals described in the Engel & Volkers Franchise Disclosure Document?
Engel_Volkers Franchise · 2025 FDDAnswer from 2025 FDD Document
nherent in operating under different legal systems and various political and economic environments. Among the risks are changes in existing tax laws, possible limitations on foreign investment and income repatriation, government price or foreign exchange controls, and restrictions on currency exchange. As of December 31, 2024 and 2023, the net assets of foreign operations are less than 10% of the Company's total net assets.
Item 22 CONTRACTS
The following agreements are attached to this Franchise Disclosure Document:
Exhibit C: Franchise Agreement, with Appendices:
App. 3 Confidentiality Agreement and Covenant Not to Compete
App. 4 Principal's Guarantee and Assumption of Obligations
App 7 Limited Purpose Sales Location Addendum to Engel & Völkers Franchise Agreement (if applicable)
App 8 Limited Purpose Administrative Location Addendum to Engel & Völkers Franchise Agreement (if applicable)
Exhibit D: State specific amendments to the Franchise Agreement for Franchisees in Illinois,
Minnesota, New York, North Dakota, Virginia and Washington.
Exhibit F: Confidentiality Agreement
Exhibit J: Renewal Rider
Exhibit K: General Release
EXHIBIT C
FRANCHISE AGREEMENT, AND APPENDICES 1 TO 8
FRANCHISE AGREEMENT for Operation of an ENGEL & VÖLKERS® RESIDENTIAL REAL ESTATE BROKERAGE
Between
ENGEL & VÖLKERS AMERICAS, INC.
And
[Franchisee]
Dated:
TABLE OF CONTENTS
| 1. | Nature and Scope of Agreement | |-----|---------------------------------------------------------| | 2. | Nature of Franchise | | 3. | Residential Real Estate Brokerages4 | | 4. | Intellectual Property Rights | | 5. | General Services to be Provided by Franchisor | | 6. | General Obligations of Franchisee | | 7. | Information Technology | | 8. | Business Supplies | | 9. | Training Courses | | 10. | Advertising and Marketing | | 11. | System Documentation | | 12. | Ongoing Development of the ENGEL & VÖLKERS System | | 13. | Reporting, Rights of Control and Data | | 14. | Fees and Royalties | | 15. | Confidential Information | | 16. | Non-Competition | | 17. | Liability/Indemnity | | 18. | Insurance Coverage | | 19. | Duration of Agreement | | 20. | Termination of Agreement | | 21. | Consequences of Expiration or Termination of Agreement | | 22. | Transfer of Rights and Obligations under this Agreement | | 23. | Multiple Owner and Business Entity Franchisee | | 24. | Representations and Warranties | | 25. | ENGEL & VÖLKERS Group and Parent Not a Party -i- | Page
| 26. | Miscellaneous Provisions 59 | ||
|---|---|---|---|
| Appendix 1 | Summary | ||
| Appendix 2 | Terms of Sale and Supply | ||
| Appendix 3 | Confidentiality Agreement and Covenant Not to Compete | ||
| Appendix 4 | Principal's Guarantee and Assumption of Obligations | ||
| Appendix 5 | Information on Multiple Owners or Entity Franchisees | ||
| Appendix 6 | State Specific Addenda to Franchise Agreement (if applicable) | ||
| Appendix 7 | Limited Purpose Sales Location (if applicable) | ||
| Appendix 8 | Limited Purpose Administrative Location (if applicable) |
FRANCHISE AGREEMENT
| This | Franchise | Agreement | (the | "Agreement") | is | entered | into | and | made | effective | this |
|---|---|---|---|---|---|---|---|---|---|---|---|
| (the "Effective Date"), |
between
ENGEL & VÖLKERS AMERICAS, INC.
- the "Franchisor"
and
xxx
- the "Franchisee".
The parties agree as follows:
1. Nature and Scope of Agreement
- 1.1 The Franchisor**:** The Franchisor offers a franchise to operate a residential real estate brokerage under the ENGEL & VÖLKERS System.
Source: Item 15 — OBLIGATION TO PARTICIPATE IN THE ACTUAL OPERATION OF THE FRANCHISE BUSINESS (FDD pages 61–62)
What This Means (2025 FDD)
According to the 2025 Engel & Volkers Franchise Disclosure Document, the non-competition obligations for franchisees and their Principals are detailed in several key areas. Specifically, Item 22 and its exhibits outline these obligations. Exhibit C, which contains the Franchise Agreement and its appendices, includes Appendix 3, titled "Confidentiality Agreement and Covenant Not to Compete," which is a primary source for understanding these restrictions. Additionally, Appendix 4, the "Principal's Guarantee and Assumption of Obligations," also addresses the obligations of the Principals.
The Franchise Agreement itself, as referenced in the Table of Contents, includes a section dedicated to non-competition under section 16. This section likely elaborates on the specific activities that are considered competitive and the duration and scope of the non-competition obligations during the term of the agreement.
Furthermore, the Confidentiality Agreement outlines that the recipient (franchisee) agrees not to provide residential real estate brokerage services competing with the Engel & Volkers System during the term of their employment, ownership participation, association, or service to the franchisee. This agreement also extends to preventing the diversion of business to other entities and includes restrictions on indirect competition, such as consulting for competitive businesses. However, it does allow for passive investment of up to 5% in publicly held competitive businesses under certain conditions.