What is the required action for Exit Franchisees regarding the geographical boundaries of the Exit territory?
Exit Franchise · 2025 FDDAnswer from 2025 FDD Document
| 5. | The geographical boundaries of the Territory are as indicated on the map attached to this page. The | | | | Territory is further described as follows: | | | | [COMPLETE | DESCRIPTION | | | THE | IN | | | GEOGRAPHICAL | DETAIL | | | INCLUDE A MAP OF THE PROTECTED TERRITORY] | AND |
- (A) Franchisee is not prohibited from listing and selling property or representing clients outside the Protected Territory. Subject to any restrictions or limitations placed upon it by State licensing authorities, Franchisee is free to deal with property and/or representation of clients at any location within the state. Likewise, other EXIT franchisees may list and sell property or represent clients domiciled in the Protected Territory.
- (B) In order to maintain the protected status of the Protected Territory, Franchisee must comply with all of the terms of this Agreement and, in particular, must comply with the provisions of this Agreement regarding maintenance of a specified minimum number of affiliated associate brokers and sales representatives, all of whom must at all times possess either a valid real estate broker's or sales representative's license for the state where the Protected Territory is located (collectively "Sales Representatives" or "Associate Brokers").
- (L) Protected Territory: The geographical area as shown on Schedule 3 attached hereto within which Franchisee has the sole right to establish a brokerage office or offices using the EXIT name and the System in accordance with the guidelines established by the EXIT and Subfranchisor.
- (A) Franchisee may, at its sole cost and expense and upon written approval of Subfranchisor, which approval shall not be unreasonably withheld, relocate its Franchise office, provided the new office is located within the Protected Territory and meets the minimum square footage and other requirements set forth in Section 3.1 above.
Source: Item 23 — RECEIPT (FDD pages 42–235)
What This Means (2025 FDD)
According to Exit's 2025 Franchise Disclosure Document, the geographical boundaries of the territory are indicated on a map attached to the franchise agreement. This territory is further described in detail within the agreement, and Schedule 3 outlines the specific geographic area considered the "Protected Territory."
The Exit franchisee is not prohibited from listing and selling property or representing clients outside the Protected Territory, provided they adhere to state licensing authority restrictions. Other Exit franchisees can also list and sell property or represent clients within the franchisee's Protected Territory.
To maintain the protected status of the territory, the Exit franchisee must comply with all terms of the agreement, particularly maintaining a minimum number of affiliated associate brokers and sales representatives who possess valid real estate licenses for the state where the Protected Territory is located. Additionally, the franchisee must get written approval from the subfranchisor to relocate the franchise office, ensuring the new location is within the Protected Territory and meets minimum square footage requirements.