What must the 1-800-GOT-JUNK? Franchisee do to ensure the Franchisor refrains from establishing another 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 not establish or operate another 1-800-GOT-JUNK? franchise within the franchisee's territory as long as the franchisee is in full compliance with the terms and conditions of the Franchise Agreement. The franchise territory is divided into subterritories, which are detailed in Schedule B of the agreement.
To operate in a subterritory, the 1-800-GOT-JUNK? franchisee must pay an additional franchise fee for each subterritory, known as Subterritory Initial Fees, as outlined in Schedule B or as agreed upon in writing with the franchisor. The franchisee cannot begin offering services in any subterritory until the Subterritory Initial Fee for that subterritory has been paid in full, unless they obtain prior written consent from 1-800-GOT-JUNK?.
If the franchisee and 1-800-GOT-JUNK? desire to add more subterritories to the territory, the franchisor may require the franchisee to enter into an amending agreement or the franchisor's current form of franchise agreement for those additional subterritories. This requirement is a condition of granting the additional subterritory, and the term of the new agreement may coincide with the term of the original agreement. The FDD also notes that if the franchisee cannot operate in one or more subterritories due to government regulations, this does not limit the franchisee's obligation to perform due diligence before entering the agreement.