Is an Exit franchisee required to allow other Exit affiliates to solicit their sales representatives for transfer?
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, an Exit franchisee is generally required to allow other Exit affiliates to solicit their sales representatives for transfer to other operating Exit offices. This requirement is specifically in effect during the ten-day period prior to the termination or non-renewal of the Franchise Agreement, immediately upon the termination or non-renewal becoming effective, and continuing thereafter.
Exit franchisees must assist in facilitating these transfers, which includes permitting and helping with the assignment of the sales representatives' listings and pending transactions to the Exit affiliate that becomes the sales representative's new broker. This obligation ensures a smooth transition of sales representatives and their business within the Exit system when a franchise agreement ends.
This requirement could impact an Exit franchisee who is not renewing or is terminating their agreement, as they may lose sales representatives to other Exit offices. However, it also benefits the Exit system as a whole by retaining experienced personnel within the brand. Prospective franchisees should consider this factor and its potential effects on their business operations when evaluating the Exit franchise opportunity.