What action can Gold Star take if a default is not remedied in a timely manner?
Gold_Star Franchise · 2025 FDDAnswer from 2025 FDD Document
If you fail to open your franchised Restaurant for business within twelve (12) months of the approval of your Retail Location, you will be in default of the Franchise Agreement. You will have 10 days after receipt of Gold Star's written notice of default to remedy the default. If the default is not remedied timely and satisfactorily, Gold Star may terminate your Franchise Agreement, at its option.
Source: Item 11 — Franchisor's Assistance, Advertising, Computer Systems, and Training (FDD pages 26–36)
What This Means (2025 FDD)
According to the 2025 Gold Star Franchise Disclosure Document, if a franchisee fails to open their franchised restaurant for business within twelve months of the approval of their retail location, they will be in default of the Franchise Agreement. The franchisee then has 10 days after receiving written notice of default from Gold Star to correct the issue.
If the franchisee does not remedy the default within the given timeframe, Gold Star has the option to terminate the Franchise Agreement. This means that Gold Star can end the franchise relationship, potentially resulting in the franchisee losing their investment and the right to operate a Gold Star restaurant.
This clause highlights the importance of adhering to the timelines set forth in the Franchise Agreement. Prospective franchisees should carefully consider the time required for site selection, construction, and other pre-opening activities to ensure they can meet the 12-month deadline. Failure to do so could lead to the termination of their franchise agreement and significant financial losses.