What agreement must each holder of an interest in the Gold Star Franchise Agreement enter into?

According to Gold Star's 2025 Franchise Disclosure Document, all individuals or entities holding an interest in the franchisee or the franchise itself must guarantee all of the franchisee's obligations under the Franchise Agreement. This means that anyone with an ownership stake is on the hook for ensuring the franchisee meets all financial and operational requirements outlined in the agreement.

Furthermore, these individuals or entities must agree to be personally bound by the confidentiality, noncompete, and transfer provisions of the Franchise Agreement. This is detailed in Section 17.2 of and Exhibit B to the Franchise Agreement. This stipulation prevents owners from disclosing confidential information, competing with Gold Star during or after the franchise term (within defined limits), or transferring their interest in a way that circumvents Gold Star's approval process.

This requirement is a standard practice in franchising, designed to protect the franchisor's brand, system, and confidential information. By requiring personal guarantees and adherence to key provisions, Gold Star aims to ensure that all parties with a vested interest in the franchise are committed to upholding the terms of the agreement and safeguarding the franchise system's integrity.