After termination or expiration, can a Gold Star franchisee allow any part of their owned or controlled premises in their Protected Territory to be used for a competing business?
Gold_Star Franchise · 2025 FDDAnswer from 2025 FDD Document
| Provision | Section in | Summary |
|---|---|---|
| Franchise Agreement | ||
| r. Non-competition covenants after the Franchise is terminated or expires | Section 11 | No competing business for 3 years and within 10 miles of your Retail Location or any other Gold Star (existing or approved) franchise (including after assignment); no part of any owned or controlled premises in your Protected Territory to be used to any extent for any competing business for 3 years |
Source: Item 17 — Renewal, Termination, Transfer, and Dispute Resolution (FDD pages 42–45)
What This Means (2025 FDD)
According to the 2025 Gold Star Franchise Disclosure Document, a franchisee is restricted from allowing any part of their owned or controlled premises in their Protected Territory to be used for a competing business, both during the franchise term and for a period after termination or expiration.
Specifically, the FDD states that after the franchise is terminated or expires, the franchisee cannot operate a competing business for 3 years within 10 miles of their Retail Location or any other existing or approved Gold Star franchise. This restriction also includes preventing the use of any part of the franchisee's owned or controlled premises within their Protected Territory for any competing business during this 3-year period.
This non-compete obligation extends beyond just the franchisee, as all holders of an interest in the franchisee or the franchise must personally agree to be bound by the noncompete provisions of the Franchise Agreement. Prospective franchisees should be aware of these restrictions and how they might impact their future business activities after leaving the Gold Star system.