What quality control standards are established by Exit and the Subfranchisor?
Exit Franchise · 2025 FDDAnswer from 2025 FDD Document
r such assistance as may be requested, and will promptly remedy all deficiencies identified by EXIT or Subfranchisor, whether or not they are identified in a formal notice of default or notice to cure.
12. OBLIGATIONS OF SUBFRANCHISOR
12.1. Initial Obligations
Prior to the opening of the franchise business, Subfranchisor will make available to Franchisee, one (1) copy of Training Manual, together with any amendments to the manual. The manual will include standard operating procedures and quality control directives designed to familiarize Franchisee with the System and better enable it to run an efficient office. The manual will also include requirements governing the use and specification of all logos, trademarks and other sales promotional materials.
12.2. Continuing Obligations
(A) During the operation of the franchise business, Subfranchisor shall make available to Franchisee, upon request, consulting services relating to the operation of its real estate services business as Subfranchisor deems appropriate and necessary, upon such terms and conditions as the parties may agree.
(B) Subfranchisor shall encourage the use of the EXIT real estate services on an international basis by members of the public.
(C) Subfranchisor shall maintain reasonable supervision over Franchisee as often as Subfranchisor shall deem necessary, to assure compliance with the System and any supplemental quality control standards as established by EXIT and Subfranchisor from time to time, and to provide guidance in the management and operations of Franchisee's office.
(D) Subfranchisor shall make available to Franchisee, the System's operating procedures, directives, and standards relating to signs, letterheads, sales promotions, office designs and other similar materials to the extent and in the manner that such materials are made available to it by EXIT or as are approved by EXIT.
(E) Subfranchisor shall limit the offering of EXIT Realty Corp. franchises to persons or entities who possess a valid real estate broker's license.
(F) In the event Subfranchisor's interest in this Agreement expires or is terminated by EXIT, for whatever reason, Subfranchisor's interest in this Agreement shall transfer to EXIT. Thereafter, EXIT or its Assignee, shall assume Subfranchisor's obligations under this Agreement.
13. RELATIONSHIP OF PARTIES
13.1. Independent Contractor
Franchisee is and shall be an independent contractor, and nothing contained in this Agreement shall be construed to create a partnership, joint venture, employment or other relationship between parties. Neither Subfranchisor nor Franchisee shall act as an agent for the other or as guarantor or surety for the obligations of the other. Neither party shall be obligated for the debts or expenses of the other. Franchisee does not have the authority to bind or obligate EXIT or Subfranchisor in any way by any promise or representation.
13.2. Subfranchisor
It is understood that Subfranchisor has been granted a license by EXIT to grant franchises and enforce EXIT's rights in the Proprietary Marks in a specified territory which includes the Protected Territory.
14. FORM OF OWNERSHIP
14.1. In General
Individuals desiring to do business as a corporation, partnership, or limited liability company shall submit to Subfranchisor in writing a statement including appropriate evidence of compliance with all of the requirements of this Section 14 as may be reasonably requested by Subfranchisor. Subfranchisor's written consent to operate as a business entity shall be promptly given in the event of compliance with the requirements below. Nothing in this Agreement shall be construed as permitting Franchisee to license the rights, duties and obligations contained in this Agreement to a corporation, partnership or limited liability company without assignment made in accordance with Section 18 of this Agreement.
Source: Item 23 — RECEIPT (FDD pages 42–235)
What This Means (2025 FDD)
According to Exit's 2025 Franchise Disclosure Document, both Exit and the Subfranchisor establish quality control standards. The Subfranchisor has a continuing obligation to maintain reasonable supervision over the franchisee to assure compliance with the Exit System and any supplemental quality control standards established by Exit and the Subfranchisor. The Subfranchisor also provides the franchisee with the System's operating procedures, directives, and standards relating to signs, letterheads, sales promotions, office designs, and other similar materials, to the extent that such materials are made available by Exit or approved by Exit.
Exit and the Subfranchisor also establish rules of operation, System standards, and quality control directives. Franchisees must strictly observe these rules, as they are an integral part of the Exit System. Franchisees also acknowledge the importance of the Exit quality control program and must adhere strictly to the quality control standards contained in the Training Manuals, which include operating procedures and quality control directives.
To maintain uniform standards of quality and service, franchisees must adopt any changes to the Proprietary Marks or Training Manuals. Franchisees must also obtain advance written approval from the Subfranchisor for the total appearance of the trade name and logo incorporating the franchisee's name or other identifying words. Franchisees are also required to protect, maintain, and advance the trade name, service mark, and the System, and report any imitations and infringements upon them.
Sales Representatives associated with Exit are also subject to quality controls. They must abide by the quality controls and safeguards established or enacted by Exit, the Subfranchisor, or Exit Trade Name to ensure compliance with applicable laws and industry standards. Sales Representatives must maintain high ethical standards, a professional appearance, and provide dependable, efficient, courteous, high-quality, and professional real estate services to the public.