What is the condition for the 1-800-GOT-JUNK? Franchisor to refrain from establishing or operating a franchise within the Territory?
1_800_Got_Junk Franchise · 2025 FDDAnswer from 2025 FDD Document
So long as Franchisee is in full compliance with the terms and conditions of this Agreement, Franchisor shall refrain from establishing or operating or granting to anyone else a franchise to establish or operate a 1-800-GOT-JUNK? business within the Territory.
The Territory will be divided into subterritories, which will be set out in Schedule B (the “Subterritories”). Franchisee shall pay an additional franchise fee for each Subterritory (“Subterritory Initial Fees”), as set out in Schedule B or as Franchisor and Franchisee may otherwise agree in writing.
Franchisee shall not, without Franchisor’s prior written consent, begin offering the Services in any Subterritory until the Subterritory Initial Fee for that Subterritory has been paid in full.
If Franchisor and Franchisee desire to add one or more additional Subterritories to the Territory, Franchisor may require, as a condition of granting such additional Subterritory, that Franchisee enter into an amending agreement, or at the election of Franchisor, Franchisor’s then current form of franchise agreement, in respect of such additional Subterritories, the term of which may coincide with the term of this Agreement.
Without limiting Franchisee’s obligation to perform due diligence prior to entering into this Agreement, in the event Franchisee is unable to operate in any one or more Subterritory due to government regulations, Franchisor
Source: Item 22 — Contracts (FDD page 24)
What This Means (2025 FDD)
According to the 2025 1-800-GOT-JUNK? Franchise Disclosure Document, the franchisor will refrain from establishing, operating, or granting a franchise to anyone else within the franchisee's territory, provided that the franchisee is in full compliance with the terms and conditions of the Franchise Agreement. This condition ensures that as long as the franchisee adheres to the agreement, 1-800-GOT-JUNK? will not directly compete or allow another franchisee to operate within the same territory. This provides a level of exclusivity and protection for the franchisee's investment and operations.
The territory is further divided into subterritories, which are detailed in Schedule B of the agreement. The franchisee must pay an additional franchise fee for each subterritory they wish to operate in. The franchisee cannot begin offering services in a subterritory until the initial fee for that subterritory is paid in full, unless they obtain prior written consent from 1-800-GOT-JUNK?.
If the franchisee wants to add more subterritories to their territory, 1-800-GOT-JUNK? may require them to enter into an amending agreement or, at 1-800-GOT-JUNK?'s election, the then-current form of franchise agreement for those additional subterritories. The term of this new agreement may coincide with the term of the original agreement. Additionally, if the franchisee cannot operate in a subterritory due to government regulations, this does not limit the franchisee's obligation to perform due diligence before entering the agreement.