Can the protected territory be different in the renewed Gold Star franchise agreement?
Gold_Star Franchise · 2025 FDDAnswer from 2025 FDD Document
The terms of such new franchise agreement may differ materially from those in this Agreement, including but not limited to the terms of the franchise agreement, higher continuing franchise fees, higher advertising expenditures, higher fees or charges of other types, a different term,
- different Protected Territory, different renewal rights and other different terms of any kind whatsoever); and
Source: Item 23 — Receipts (FDD pages 53–163)
What This Means (2025 FDD)
According to Gold Star's 2025 Franchise Disclosure Document, the protected territory in a renewed franchise agreement can indeed be different from the original agreement. Specifically, the FDD states that when a franchisee exercises their option to renew, they will be required to execute Gold Star's then-current form of franchise agreement.
The document explicitly notes that the terms of the new franchise agreement at the time of renewal may differ materially from the original agreement. These differences can include, but are not limited to, changes in the franchise agreement terms, higher fees, a different term length, a different protected territory, and different renewal rights.
This means that a Gold Star franchisee should not assume that their protected territory will remain the same upon renewal. The franchisor has the right to modify the protected territory based on the franchise agreement in effect at the time of renewal. Therefore, it is crucial for franchisees to carefully review the new franchise agreement presented at the time of renewal to understand any potential changes to their protected territory and other key terms.