As a condition of transfer, does Exit Realty Upper Midwest require a current Franchise Agreement to be signed by the new Franchisor or Franchisee?
Exit Franchise · 2025 FDDAnswer from 2025 FDD Document
| l. EXIT Realty Upper Midwest’s approval of transfer by Franchisee | 18 | EXIT Realty Upper Midwest has the right to approve all transfers but will not unreasonably withhold approval. |
|---|---|---|
| m. Conditions for EXIT Realty Upper Midwest approval of transfer | 18 | New Franchisee qualifies, transfer fee (10% of the then current initial franchise fee, not to exceed 25% of the Initial Franchise fee paid) paid, purchase agreement approved, training arranged, Assignment signed and current Franchise Agreement signed by new Franchisor or Franchisee (also see the non-competition section below). |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 27–31)
What This Means (2025 FDD)
According to Exit's 2025 Franchise Disclosure Document, a condition for Exit Realty Upper Midwest's approval of a franchise transfer is that a current Franchise Agreement must be signed by either the new Franchisor or Franchisee. This requirement is part of a set of conditions that must be met for the transfer to be approved.
Other conditions for transfer approval include ensuring the new franchisee meets the qualification standards set by Exit Realty Upper Midwest. Additionally, a transfer fee must be paid, which is calculated as 10% of the then-current initial franchise fee, but this fee will not exceed 25% of the initial franchise fee that was originally paid.
Furthermore, the purchase agreement related to the transfer must be approved by Exit Realty Upper Midwest. Arrangements for training the new franchisee must also be made to ensure they are adequately prepared to operate the franchise. Finally, an assignment document must be signed to legally transfer the franchise rights.