What is the duration of the period before termination or non-renewal when other Exit affiliates can solicit the franchisee's sales representatives?
Exit Franchise · 2025 FDDAnswer from 2025 FDD Document
- (K) Franchisee shall allow other EXIT Affiliates to solicit Franchisee's Sales Representative for transfer to other operating EXIT offices.
During the ten (10)-day period prior to termination or non-renewal of this Agreement, immediately upon the termination or non-renewal becoming effective and continuing thereafter, Franchisee shall allow other EXIT affiliates to solicit Franchisee's Sales Representatives for transfer to other operating EXIT offices.
Franchisee shall assist in effectuating such transfers and shall permit and facilitate the assignment of the Sales Representatives' listings and pending transactions to the EXIT Affiliate as the Sales Representative's new broker.
Source: Item 23 — RECEIPT (FDD pages 42–235)
What This Means (2025 FDD)
According to Exit's 2025 Franchise Disclosure Document, other Exit affiliates are allowed to solicit an Exit franchisee's sales representatives for transfer to other operating Exit offices during the ten-day period prior to the termination or non-renewal of the Franchise Agreement. This solicitation is allowed immediately upon the termination or non-renewal becoming effective and continues thereafter.
This means that as an Exit franchisee approaches the end of their agreement, whether through termination or non-renewal, other Exit offices can actively recruit their sales representatives. The franchisee is obligated to assist in these transfers, including facilitating the assignment of the sales representatives' listings and pending transactions to the new Exit broker.
This clause could create instability for a franchisee nearing the end of their term, as their sales team could be enticed to move to other Exit locations. It also means that an Exit franchisee needs to be aware of this possibility and potentially take steps to retain their sales representatives during this period. This could involve offering incentives or addressing any concerns that might make their sales representatives consider a move.