Which section of the Exit Franchise Agreement discusses the franchisee's obligations related to territorial development and sales quotas?
Exit Franchise · 2025 FDDAnswer from 2025 FDD Document
[Item 12: TERRITORY]
ITEM 12 TERRITORY
The Franchise Agreement grants you the right to establish a real estate sales office in a specified geographic territory ("Protected Territory") that is described by boundary streets, highways, cities, counties, or other recognizable demarcations and can be further delineated by a map attached as a part of the Franchise Agreement. You are granted the exclusive right to establish an EXIT realty office within the Protected Territory. You are not restricted from selling real estate services outside your Protected Territory. There is no minimum Protected Territory granted, although the Protected Territory is generally as follows: High density – over 50,000 population; Medium density – 20,000-50,000 population and Rural density – less than 5,000 population. You receive exclusivity for the location of your office. You will not receive an exclusive Territory for EXIT listings and/or sales. You may face competition from other franchisees, from outlets that we own, or from other channels of distribution or competitive brands that we control.
Other EXIT franchises may provide real estate services within your Protected Territory. No compensation is paid to you by us or EXIT for real estate sales by other EXIT franchises within your Protected Territory. Similarly, you may sell real estate services outside of your Protected Territory. There are no restrictions on either you or any other EXIT Franchisee from providing real estate services outside a Protected Territory, including no restrictions on your right to use other channels of distribution, such as the internet, telemarketing or direct marketing, to make sales outside the Protected Territory. EXIT, EXIT Realty Upper Midwest and other EXIT Realty Franchisees reserve the right to use other channels of distribution, including the internet, within the Protected Territory, using EXIT's principal trademarks or using different trademarks. Your exclusivity within the Protected Territory relates only to your operation of an EXIT office within the Protected Territory. The Franchise Agreement provides that EXIT Realty Upper Midwest may not establish either a company-owned or franchised outlet, in the Protected Territory, selling the same goods or similar goods or services under the same or similar trademarks or service marks during the term of the Franchise
Source: Item 9 — FRANCHISEE'S OBLIGATIONS (FDD pages 18–19)
What This Means (2025 FDD)
Based on the 2025 FDD, Item 12 of the Exit Franchise Agreement discusses the franchisee's territory. It specifies that while franchisees receive a protected territory for the location of their office, they do not receive an exclusive territory for Exit listings and/or sales. This means franchisees may face competition from other franchisees, company-owned outlets, or other channels of distribution controlled by Exit. The agreement grants the franchisee the exclusive right to establish an Exit realty office within the Protected Territory. The agreement outlines that other Exit franchises may provide real estate services within the franchisee's Protected Territory, and no compensation is paid for real estate sales by other Exit franchises within that territory.
Furthermore, there are no restrictions on the franchisee or other Exit franchisees from providing real estate services outside a Protected Territory. This includes using other channels of distribution like the internet, telemarketing, or direct marketing to make sales outside the territory. Exit and other Exit Realty franchisees reserve the right to use other channels of distribution, including the internet, within the Protected Territory, using Exit's principal trademarks or different trademarks. The franchisee's exclusivity within the Protected Territory relates only to the operation of an Exit office within that territory.
However, the provided excerpts from the 2025 FDD do not explicitly mention any obligations related to territorial development or sales quotas. A prospective franchisee should review the full Franchise Agreement and ask the franchisor directly about any specific requirements or expectations for developing the territory and achieving sales targets.