What happens to Exit Subfranchisor's interest in the Agreement if it expires or is terminated by EXIT, and who assumes the Subfranchisor's obligations?

According to Exit's 2025 Franchise Disclosure Document, if the Subfranchisor's interest in the agreement expires or is terminated by Exit for any reason, the Subfranchisor's interest transfers directly to Exit. Following this transfer, Exit, or an assignee designated by Exit, will assume all of the Subfranchisor's obligations under the agreement. This means Exit takes over the responsibilities and duties that the Subfranchisor previously held.

For a prospective Exit franchisee, this clause provides a level of security. If the Subfranchisor's relationship with Exit ends, Exit steps in to ensure the franchise continues to operate and fulfill its obligations. This transition aims to minimize disruption and maintain the standards and support expected under the franchise agreement.

This type of provision is fairly standard in franchising, as it protects the brand and the interests of individual franchisees. It ensures that even if a regional or area developer loses their rights, the overall franchise system remains intact and operational. Franchisees should confirm with Exit how this transition process is managed to ensure a smooth continuation of services and support.