Under what circumstances will a Remax franchisee be required to pay a Lost Future Revenue fee?
Remax Franchise · 2025 FDDAnswer from 2025 FDD Document
| Type of Fee1 | Amount | Due Date | Remarks |
|---|---|---|---|
| Lost Future Revenue15 | Will vary under circumstances | Upon early termination or abandonment. | Payable if the Franchise Agreement or Team Office Amendment is terminated early for any other reason than pursuant to mutual consent. |
15 Lost Future Revenue shall be calculated as the combined Monthly Ongoing Fees, Annual Dues, and Marketing Fund fees that would have been payable under the Franchise Agreement from the date of early termination of the Franchise Agreement or abandonment of the Office through the number of months (or partial months) remaining in the term of the Franchise Agreement, multiplied by the greater of: (i) the highest number of Sales Associates and unreported agents affiliated with your Office during any month prior to early termination; or (ii) the number of Sales Associates required under Section 7 of the Franchise Agreement to have been affiliated with the Office during such period remaining in the term of the Franchise Agreement, plus, all incentives that have been granted to you at any time during the term of the Franchise Agreement. The total of these amounts shall constitute Lost Future Revenue. RE/MAX Regional may also seek or receive intangible damages and any and all other damages or remedies to which it may be entitled at law or in equity.
Source: Item 5 — INITIAL FEES (FDD pages 29–43)
What This Means (2025 FDD)
According to Remax's 2025 Franchise Disclosure Document, a franchisee will be required to pay a Lost Future Revenue fee if the Franchise Agreement or Team Office Amendment is terminated early for any reason other than mutual consent or if the franchisee abandons the office. This fee is designed to compensate Remax for the revenue it would have received had the franchisee continued operating for the full term of the agreement.
The Lost Future Revenue is calculated by combining the Monthly Ongoing Fees, Annual Dues, and Marketing Fund fees that would have been payable from the date of early termination or abandonment through the remaining months of the franchise term. This total is then multiplied by the greater of either the highest number of Sales Associates affiliated with the office during any month prior to termination, or the number of Sales Associates required under Section 7 of the Franchise Agreement to be affiliated with the office during the remaining term. The calculation also includes all incentives that were granted to the franchisee during the term of the Franchise Agreement.
In addition to the Lost Future Revenue, Remax may also pursue intangible damages and any other legal or equitable remedies available to them. This means that the financial consequences of early termination or abandonment can be significant for a Remax franchisee, potentially including not only the calculated Lost Future Revenue but also additional amounts for other damages suffered by Remax. This is a fairly standard practice in franchising, as franchisors aim to recoup anticipated revenues when a franchisee breaks the agreement early.