What happens if a Caring Transitions franchisee operates in another franchisee's territory?
Caring_Transitions Franchise · 2025 FDDAnswer from 2025 FDD Document
You may not operate your franchise in another franchisee's territory, except as disclosed in this Item 12. "Operate your franchise in another franchisee's territory" means advertising, soliciting, offering, providing, or selling products or services in another franchisee's territory. The exclusivity of your territory begins once you complete our initial training program and become fully operational.
Although we are not obligated to do so under the franchise agreement, we may permit you to operate your franchise in areas outside your territory that are not part of another Caring Transitions franchisee's territory. We may, in our discretion, allow you to continue serving existing clients located in areas outside your territory after such area later becomes part of another franchisee's territory, but you must stop soliciting and serving new clients in any such area. Similarly, earlier Caring Transitions franchisees may have operated their franchises in areas that later became part of your territory; if so, they will be permitted to continue to provide services in your territory to clients they already had in your territory before you opened your franchise, but they will be prohibited from soliciting and serving any new clients in your territory once you open your franchise. In addition, we may permit you to operate in the territory of a franchisee that has been provided written notification of a default under
the franchise agreement and who has not cured the default within 30 days. In this event, the exclusivity of the defaulting franchisee's territory could, in our discretion, be suspended until the default is cured. You do not acquire any rights to any areas outside your territory and you must immediately stop operating your franchise in areas outside your territory upon notification from us.
Source: Item 12 — TERRITORY (FDD pages 29–31)
What This Means (2025 FDD)
According to Caring Transitions's 2025 Franchise Disclosure Document, a franchisee is generally prohibited from operating their franchise in another franchisee's exclusive territory. "Operate your franchise in another franchisee's territory" is defined as advertising, soliciting, offering, providing, or selling products or services in that other franchisee's territory. This territorial exclusivity begins once the franchisee completes the initial training program and becomes fully operational.
However, Caring Transitions may allow a franchisee to operate in another franchisee's territory if the other franchisee has been given written notification of a default under the franchise agreement and has not cured the default within 30 days. In such cases, Caring Transitions has the discretion to suspend the exclusivity of the defaulting franchisee's territory until the default is resolved.
Caring Transitions may also allow franchisees to continue serving existing clients in areas that later become part of another franchisee's territory, but they must stop soliciting and serving new clients in that area. Similarly, earlier franchisees may continue to serve clients they had before a new franchisee opened in that territory, but they cannot solicit new clients. These exceptions are important for prospective franchisees to understand, as they clarify the boundaries of their exclusive territory and the circumstances under which those boundaries may be adjusted.