What is the effect of the addendum on the original Gold Star Chili Franchise Agreement?
Gold_Star Franchise · 2025 FDDAnswer from 2025 FDD Document
EXHIBIT H to FRANCHISE DISCLOSURE DOCUMENT
ADDENDUM TO THE GOLD STAR CHILI FRANCHISE AGREEMENT REQUIRED BY THE STATE OF INDIANA
In recognition of the requirements of the Indiana Disclosure Law, Indiana Code §§ 23-2- 2.5-1 to 23-2-2.5-51 and the Indiana Deceptive Franchise Practices Act, Indiana Code §§ 23-2- 2.7-1 to 23-2-2.7-7, the parties to the attached Gold Star Chili, Inc. Franchise Agreement (the "Agreement") agree as follows:
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- Section 1 of the Agreement, under the heading "Grant of Franchise," shall be supplemented by the following subsection 1.7, which shall be considered an integral part of the Agreement:
- "C. No Unfair Competition. Licensor agrees that it shall not compete unfairly with Licensee within a reasonable area surrounding the approved location of the licensed location."
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- Section 22.1 of the Agreement shall be deleted in its entirety, and shall have no force or effect; and the following shall be substituted in lieu thereof:
Source: Item 23 — Receipts (FDD pages 53–163)
What This Means (2025 FDD)
According to the 2025 Gold Star Franchise Disclosure Document, Exhibit H outlines an addendum to the standard franchise agreement specifically for franchisees in Indiana. This addendum addresses requirements under Indiana law.
The addendum modifies specific sections of the original agreement. First, it supplements Section 1, "Grant of Franchise," by adding subsection 1.7, which states that Gold Star agrees not to compete unfairly with the franchisee within a reasonable area around their approved location. This provides a degree of territorial protection for the franchisee.
Second, the addendum replaces Section 22.1 of the original agreement entirely, meaning the original terms of that section are nullified and the new language in the addendum takes its place. While the specific content of the original Section 22.1 is not provided in this excerpt, it is clear that the addendum makes a significant change by substituting it with new terms. Prospective franchisees in Indiana should carefully review both the original Section 22.1 and its replacement in the addendum to understand the full implications of this change.