When does any modification to the Exit Formula become effective?
Exit Franchise · 2025 FDDAnswer from 2025 FDD Document
It is understood that this EXIT Formula may not be changed or modified in any way without the prior express written permission of EXIT. EXIT reserves the right to modify this EXIT Formula and may increase the Annual Membership and fees up to 5% per year. If EXIT increases any amounts less than 5%, the unused portion may be carried over to subsequent years. Any modification shall become effective upon notice to all Subfranchisors and Franchisees. It shall be Franchisee's obligation to notify its Sales Representatives and employees of modifications in the EXIT Formula.
Source: Item 23 — RECEIPT (FDD pages 42–235)
What This Means (2025 FDD)
According to Exit's 2025 Franchise Disclosure Document, any modification to the Exit Formula becomes effective upon notice to all Subfranchisors and Franchisees. It is then the Franchisee's responsibility to inform their Sales Representatives and employees of these changes.
This means that Exit can change the formula, including fees, as long as they provide notice. Franchisees need to stay informed of any communications from Exit regarding changes to the Exit Formula to ensure they are compliant and can accurately inform their sales representatives and employees.
While Exit reserves the right to modify the Exit Formula, they can only increase the Annual Membership and fees up to 5% per year. If Exit increases any amounts less than 5%, the unused portion may be carried over to subsequent years. This provides some predictability for franchisees in terms of potential cost increases.