Under what condition can Remax, LLC terminate the regional master franchise agreement with Remax Regional?
Remax Franchise · 2025 FDDAnswer from 2025 FDD Document
You understand and acknowledge that REMAX Regional and REMAX, LLC are parties to a regional master franchise agreement which authorizes REMAX Regional to sell franchises for RE/MAX offices. REMAX, LLC may terminate the regional master franchise agreement if REMAX Regional materially violates its terms. You acknowledge that in the event of the termination or expiration of the regional master franchise agreement between REMAX Regional and REMAX, LLC, REMAX, LLC shall have the option, to be exercised in its sole discretion, to elect to assume REMAX Regional's rights and obligations under this Agreement (or to designate another party to assume such rights and obligations) or to immediately terminate this Agreement upon notice to you. If REMAX, LLC elects to assume (or to designate another party to assume) such rights and obligations, you consent to the assumption and the assignment of all related rights under this Agreement, and you agree to execute any documents and take such other actions required or deemed necessary by REMAX, LLC to effect such assumption and assignment. You further agree that in the event of such an assumption and assignment, you shall hold REMAX, LLC harmless from any
obligation for performance or liability for default or non-performance by REMAX Regional under this Agreement which arises before the effective date of the assumption and assignment.
Source: Item 22 — Contracts (FDD pages 108–334)
What This Means (2025 FDD)
According to Remax's 2025 Franchise Disclosure Document, Remax, LLC has the right to terminate the regional master franchise agreement with Remax Regional if Remax Regional materially violates its terms. If this agreement is terminated or expires, Remax, LLC has the option to assume Remax Regional's rights and obligations under the franchise agreement with the franchisee, or designate another party to do so. Alternatively, Remax, LLC can immediately terminate the franchise agreement with notice to the franchisee.
If Remax, LLC chooses to assume the rights and obligations, the franchisee must consent to this and the assignment of rights, and also execute any necessary documents. The franchisee also agrees to hold Remax, LLC harmless from any obligations or liabilities resulting from Remax Regional's actions or non-performance before the assumption date.
This clause protects Remax by allowing it to maintain the franchise network even if a regional master franchisee fails to meet its obligations. For a prospective franchisee, this means that the stability of their franchise agreement depends not only on their relationship with Remax Regional, but also on the agreement between Remax Regional and Remax, LLC. It is important for franchisees to understand that Remax can step in and take over the agreement or terminate it, which could significantly impact their business operations.