Does Exit provide any assistance in obtaining financing?
Exit Franchise · 2025 FDDAnswer from 2025 FDD Document
Except as listed below, EXIT and EXIT Realty Upper Midwest are not required to provide you with any assistance.
The Company's operations have been funded through capital contributions from the stockholders, financing by EXIT Realty Corp. International, and cash flows from operations. The Company is growing and, as such, is incurring expenditures in the near term to benefit the future as it looks to grow the franchisee base and expand into new markets. Such expenses could be reduced or eliminated to improve operating cash flows as needed in the future.
During the year ended December 31, 2023, management took several actions in an attempt to improve operating cash flows including the restructuring of notes payable owed to Exit Realty Corp. International, as disclosed in Note 3 – Notes Payable, and the negotiation of increased territory management with Exit Realty Corp. International as disclosed in Note 1 – Significant Accounting Policies: Intangible Assets. As of the date these financial statements were available to be issued, the Company continues to sell franchises, and is generating franchise commissions revenues from open and operating franchisees. The Company believes that the combination of the actions taken, along with the decrease in interest rates that are projected to induce housing market stimulation, will enable the Company to meet its funding requirements for one year from the date these financial statements were available to be issued. If necessary, stockholders of the Company intend to provide any financial assistance needed by the Company should its cash flows from operations combined with its cash balances not be sufficient to meet its working capital needs. Management believes that the stockholders have the intent and ability to provide the funds needed, if any, to continue to fund the operations of the Company for at least one year from the date these financial statements were available to be issued.
Source: Item 10 — FINANCING (FDD page 19)
What This Means (2025 FDD)
According to Exit's 2025 Franchise Disclosure Document, Exit and Exit Realty Upper Midwest are generally not required to provide franchisees with any assistance. However, the document does state that the company's operations have been funded through capital contributions from stockholders, financing by Exit Realty Corp. International, and cash flows from operations.
The FDD mentions that during the year ended December 31, 2023, management restructured notes payable owed to Exit Realty Corp. International and negotiated increased territory management with them. The company believes that these actions, along with projected decreases in interest rates, will enable it to meet its funding requirements for one year from the date the financial statements were issued.
Furthermore, the stockholders of Exit intend to provide any financial assistance needed by the company should its cash flows from operations combined with its cash balances not be sufficient to meet its working capital needs. Management believes that the stockholders have the intent and ability to provide the funds needed, if any, to continue to fund the operations of the Company for at least one year from the date these financial statements were available to be issued. While this indicates financial backing for the company itself, it does not explicitly state that Exit provides direct financial assistance to franchisees.