What is the purpose of Schedule 3 in the Exit Realty Corp. Franchise Agreement?
Exit Franchise · 2025 FDDAnswer from 2025 FDD Document
ent and agrees to immediately notify Subfranchisor of any changes in the information through the term of this Agreement.
2. GRANT OF FRANCHISE
2.1. Grant of Franchise.
Subfranchisor grants to Franchisee, and Franchisee accepts, the right to use the federally registered service mark "EXIT" and such other Proprietary Marks (as defined in Section 43 of this Agreement) as Subfranchisor may designate from time to time for the purpose of operating a real estate brokerage/real estate service office within the specific geographic area (the "Protected Territory") outlined in the Description of Protected Territory (Schedule 3 of this Agreement) during the term of this Agreement, upon the terms and conditions of this Agreement and in accordance with guidelines established by Subfranchisor and EXIT (the "Franchise"). This grant is conditioned upon (i) Franchisee obtaining and maintaining a valid real estate broker's license in the state containing the Protected Territory to enable Franchisee to perform the full range of real estate services to be provided under the System, (ii) Franchisee not defaulting under this Agreement, and (iii) this Agreement not being terminated, canceled or abandoned.
2.2. Exclusivity
- (A) So long as Franchisee is not in breach of this Agreement, neither Subfranchisor nor EXIT shall establish another real estate service Franchise or EXIT owned real estate service office within the Protected Territory using the Proprietary Marks.
Source: Item 23 — RECEIPT (FDD pages 42–235)
What This Means (2025 FDD)
According to Exit's 2025 Franchise Disclosure Document, Schedule 3 of the Franchise Agreement outlines the Description of the Protected Territory granted to the franchisee. This means Schedule 3 defines the specific geographic area where the Exit franchisee has the right to operate a real estate brokerage or service office using Exit's service marks.
The grant of this protected territory is conditional. The franchisee must maintain a valid real estate broker's license in the state containing the protected territory, avoid defaulting on the Franchise Agreement, and ensure the agreement is not terminated, canceled, or abandoned. These conditions are typical in franchise agreements to ensure the franchisee remains compliant and capable of operating the business.
So long as the franchisee is not in breach of the agreement, neither the subfranchisor nor Exit can establish another real estate service franchise or an Exit-owned real estate service office within the protected territory using Exit's proprietary marks. However, if the franchisee defaults on the agreement and fails to cure the default in a timely manner, the agreement automatically becomes nonexclusive. In this case, the subfranchisor has the right to operate or sell franchises within the previously protected territory, in addition to other rights and remedies.