Upon termination or expiration of the Franchise Agreement, what happens to the Exit franchisee's right to use the Trade Style name?
Exit Franchise · 2025 FDDAnswer from 2025 FDD Document
mplied with the provisions of this Agreement, curing all defaults and non-compliance under this Agreement and any other franchise agreements or other agreements it may have with Subfranchisor and/or EXIT.
9.3. Franchisee's Trade Name; Legal Name
- (A) Franchisee shall conduct its business under the trade name that includes the word "EXIT" and either the words "Realty" or "Real Estate" (hereinafter "Trade Style name"). Franchisee shall obtain Subfranchisor's written approval of its Trade Style name, prior to making any commitments or records of such name. The word EXIT must be positioned at the beginning of the name and EXIT must always be in CAPS. In no event shall such name contain any arbitrary, whimsical, invented or suggestive words or acronyms. Franchisee will file for a certificate of fictitious or assumed name in the manner required by applicable state law so as to notify the public that Franchisee is operating its Franchise as an independent business pursuant to this Agreement. Franchisee shall have no right to use or register the Trade Style name apart from the right granted under this Agreement, and all such rights shall cease upon the termination or expiration of this Agreement.
- (B) The Trade Style name is the name under which the Franchisee shall conduct business, and shall be different than Franchisee's legal entity name. Franchisee's legal name shall not include the name "EXIT."
- (C) Franchisee may not change the Trade Style name or the legal name without prior written consent of Subfranchisor, which shall not be unreasonably withheld.
- (D) If Franchisee decides to advertise, promote, or otherwise conduct business by means of the Internet or World Wide Web, Franchisee shall also utilize a domain name which includes the word "EXIT" and the EXIT Logo. Any such domain name must be approved by Subfranchisor in writing prior to Franchisee's use of it. All marketing shall be in accordance with the standards and guidelines provided in the Training Manuals.
- (E) Neither the Trade Style name nor any domain name, application name or social media profile name may include the words "National, International, Canada, U.S., or North America," nor provide any indication that the Franchisee has the exclusive rights under this Agreement to more than the Protected Territory.
9.4. Written Materials; Advertising; Signs
- (A) Franchisee shall feature in the operation of its real estate service and in all materials and advertising, the distinguishing characteristics of the System in accordance with the Training Manual (as defined in Section 43) or as contained in specific directives from Subfranchisor or EXIT as may be issued from time to time.
- (B) Franchisee shall include the following statement on Franchisee's web page, telephone book advertisements, exterior sign, lawn signs, letterhead, deposit receipt forms, listing agreements and other printed materials: "each office independently owned and operated" or "Independent Member Broker." Franchisee shall conspicuously display the statement on its web page (if any) and at a prominent location at the main entrance of its office.
- (C) Franchisee shall erect and maintain at its office premises an exterior sign in conformance with the local municipality's sign codes and EXIT's operating procedures and quality control directives. Design specifications for Franchisee's sign must be approved by Subfranchisor prior to Franchisee making any commitment to any contractor to construct the sign and prior to display at the Franchise office.
Source: Item 23 — RECEIPT (FDD pages 42–235)
What This Means (2025 FDD)
According to Exit's 2025 Franchise Disclosure Document, the franchisee's right to use the Trade Style name ceases immediately upon termination or expiration of the Franchise Agreement. The Trade Style name must include the word "EXIT" and either "Realty" or "Real Estate", with "EXIT" positioned at the beginning and always capitalized. The franchisee cannot register or use the Trade Style name outside the rights granted by the Franchise Agreement.
Upon termination or non-renewal, the Exit franchisee must immediately stop using the Exit System, including trade names, trademarks, service marks, and other distinguishing characteristics. The franchisee must also take steps to differentiate their operations from Exit and its affiliates to avoid public confusion. This includes changing signs, telephone numbers, and buildings as directed by Exit or the Subfranchisor.
Furthermore, the Exit franchisee is required to file forms to abandon any assumed name certificates related to the Exit brand and transfer any related domain names, websites, and email addresses to the Subfranchisor. The franchisee must also refrain from using the term "EXIT" or any confusingly similar term in any subsequent business to avoid creating confusion about their affiliation with the Exit system. Subfranchisor retains the right to execute documents to discontinue the franchisee's use of the trade name if the franchisee fails to do so.