Under what condition does the restriction on owning, operating, or engaging in a real estate brokerage business within a ten-mile radius of the Exit Franchisee's office not apply?
Exit Franchise · 2025 FDDAnswer from 2025 FDD Document
- (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, the restriction on owning, operating, or engaging in a real estate brokerage business within a ten-mile radius of the Exit franchisee's office does not apply if the Franchise Agreement has expired at the end of its term. This means that once the initial term of the agreement is over and the agreement is not renewed, the franchisee is no longer bound by this particular restriction.
This provision allows a former Exit franchisee to pursue other real estate ventures without being constrained by the non-compete clause after the franchise agreement concludes naturally. It is important to note that this exception only applies if the agreement expires at the end of its term. If the agreement is terminated early for any reason, the restriction may still apply.
For a prospective Exit franchisee, this clause offers some flexibility and future options. It means that after dedicating time and effort to building an Exit franchise, they will have the freedom to explore other opportunities in the real estate sector without immediate geographical limitations, provided they fulfill their obligations and the agreement runs its full course.