Under the Remax franchise agreement, what individual owner qualifications does RE/MAX Regional rely on when entering into an agreement with a Business Entity?
Remax Franchise · 2025 FDDAnswer from 2025 FDD Document
If you are presently a corporation, partnership, limited liability company, or other business entity (collectively "Business Entity"), or if you, as an individual or individuals, make a subsequent assignment or transfer of this Agreement to a Business Entity under Section 12 of this Agreement, you will notice certain provisions that are applicable to the individual owner(s) of the Business Entity. Depending on the type of Business Entity, these individual owners would be the shareholder(s), partner(s), member(s), or other individuals who have a legal or equitable ownership interest in, or who otherwise have the right to control, the Business Entity. We have relied on the qualifications, business skill, financial capability and personal character of these individual owners in entering into this Agreement with, or in permitting such assignment or transfer to, the Business Entity. We refer to these individual owners as "Owners." If you are a Business Entity that is owned, in whole or in part, by one or more other Business Entities (each a "Parent Entity"), reference to Owners in this Agreement also means the individual or individuals who own or who otherwise have a legal right to control, any Parent Entity.
Source: Item 22 — Contracts (FDD pages 108–334)
What This Means (2025 FDD)
According to the 2025 Remax Franchise Disclosure Document, when RE/MAX Regional enters into an agreement with a business entity, it relies on the qualifications, business skill, financial capability, and personal character of the individual owners of that entity. These individual owners are defined as those who have a legal or equitable ownership interest or the right to control the business entity, whether they are shareholders, partners, members, or other individuals. If the business entity is owned by another business entity (a Parent Entity), the individual owners are those who own or control the Parent Entity.
This reliance on individual owner qualifications means that prospective Remax franchisees operating as a business entity must ensure that their owners meet Remax's standards. Remax assesses these owners' backgrounds to determine if they possess the necessary skills and integrity to uphold the Remax brand. This requirement extends to individuals who ultimately control the franchise, even if they do so through multiple layers of business entities.
For potential franchisees, this underscores the importance of transparency and careful selection of owners. Remax requires complete and accurate information about the ownership structure and the individuals involved. Any misrepresentation or omission of material information regarding the owners' integrity or character can be grounds for denying the franchise or terminating the agreement. This emphasis on individual owner qualifications reflects Remax's commitment to maintaining its brand reputation and ensuring that its franchisees operate with competence and ethical standards.