Is there a geographic limit to the restriction on owning, operating, or engaging in a real estate brokerage business after the Exit Agreement expires?
Exit Franchise · 2025 FDDAnswer from 2025 FDD Document
and guarantors of this Agreement will not, for a period of one (1) year following the termination, assignment or expiration of this Agreement on their own account or as an employee, agent, consultant, partner, officer, director or shareholder of any other person, firm, entity, limited liability company, partnership or corporation, directly or indirectly,
- (a) within a ten (10) mile radius of Franchisee's office, own, operate, lease, franchise, conduct, engage in, be connected with, have any interest in or assist any person or entity engaged in any real estate brokerage business, which business utilizes at any location a reward system for "sponsoring" sales representatives at any of its locations, or in any other way operates substantially similar manner to the EXIT System; or
- (b) within a ten (10) mile radius of Franchise's office own, operate, lease, franchise, conduct or engage in, be connected with, have any interest in or assist any person or entity engaged in any real estate brokerage business, provided the foregoing shall not apply if this Agreement expired at the end of its term.
Source: Item 23 — RECEIPT (FDD pages 42–235)
What This Means (2025 FDD)
According to Exit's 2025 Franchise Disclosure Document, there are geographic limitations regarding involvement in a real estate brokerage business after the franchise agreement expires or is terminated. Specifically, the franchisee is restricted from engaging in certain real estate activities within a ten-mile radius of their former Exit office. This restriction includes owning, operating, leasing, franchising, conducting, or having any interest in a real estate brokerage that uses a reward system for sponsoring sales representatives or operates in a substantially similar manner to the Exit system.
Additionally, the franchisee is restricted from engaging in a real estate brokerage business within a ten-mile radius of the former Exit office, regardless of the reward system. However, this particular restriction does not apply if the agreement expires at the end of its term.
Furthermore, the franchisee is prohibited from engaging in the business of selling, managing, or servicing real estate franchise organizations within the state(s) where the Protected Territory is located. This restriction applies irrespective of whether services are provided directly to the franchising operations or to the Exit franchisee's.