Are Exit Sales Representatives allowed to endorse or negotiate checks on behalf of Exit?
Exit Franchise · 2025 FDDAnswer from 2025 FDD Document
All fees and commissions earned in connection with the sale, lease or rental of real estate and any interest in or service related to real estate are made payable to EXIT [Trade Name].
Any monies received on account of commission by Sales Representative from any trade in real estate conducted by the Sales Representative, shall be held by EXIT [Trade Name] in trust and EXIT [Trade Name] shall disperse in a timely fashion directly to the Sales Representative commission due to the Sales Representative in connection with the Transaction Record Sheet completed at the time of closing the transaction.
Sales Representative irrevocably directs EXIT [Trade Name] to deduct from any commissions payable to Sales Representative, the amount of any indebtedness owed to EXIT [Trade Name] or EXIT, as outlined in this Agreement and the EXIT Formula.
Source: Item 23 — RECEIPT (FDD pages 42–235)
What This Means (2025 FDD)
According to Exit's 2025 Franchise Disclosure Document, all fees and commissions earned by sales representatives are made payable to Exit. The document specifies that any monies received on account of commission by Sales Representatives from any trade in real estate conducted by the Sales Representative, shall be held by Exit in trust and Exit shall disperse in a timely fashion directly to the Sales Representative commission due to the Sales Representative. This indicates that Sales Representatives are not authorized to handle commission checks directly, as all payments are to be processed through Exit.
This arrangement ensures that Exit maintains control over the financial transactions and can properly manage the distribution of commissions. It also allows Exit to deduct any outstanding debts or fees owed by the Sales Representative, as the document states that Sales Representatives irrevocably direct Exit to deduct from any commissions payable to Sales Representative, the amount of any indebtedness owed to Exit. This process protects Exit's financial interests and ensures compliance with the terms of the franchise agreement.
For a prospective Exit franchisee, this means that they will not have the authority to endorse or negotiate commission checks on behalf of Exit. Instead, all financial transactions related to commissions will be managed directly by Exit, providing a level of financial oversight and control. This arrangement is typical in many franchise systems, where the franchisor maintains control over financial matters to ensure consistency and compliance across all franchise locations.