How must the continuing franchise fee be paid to Gold Star?
Gold_Star Franchise · 2025 FDDAnswer from 2025 FDD Document
Unless otherwise required in the Manual, the continuing franchise fee shall be payable by FRANCHISEE to the COMPANY on or before Tuesday of each week based on the Gross Sales for the preceding week ending on Sunday pursuant to the preauthorized debit arrangement described in Section 8.3, below.
- 8.3.2 FRANCHISEE will complete and execute an "Authorization for Electronic Fund Transfers" form and any other form provided by the COMPANY for the purpose of authorizing electronic debits, submit any information required by the COMPANY for such authorization, comply with procedures specified by the COMPANY, and perform such additional acts as may be necessary to accomplish payment by electronic fund transfer.
By signing this Agreement, FRANCHISEE authorizes the COMPANY to initiate debit entries and credit correction entries to a designated checking account for payment of continuing franchise fees, Brand Building Fees, or any other amounts payable to the COMPANY, including, without limitation, audit fees (Section 10.2), operating fees (Section 5.14), renewal fee (Section 16.1.8), attorney fees, interest and late fees.
FRANCHISEE will maintain a business account at a bank or other financial institution with the capacity to electronically debit FRANCHISEE's account.
- 8.3.3 FRANCHISEE will maintain an account balance sufficient to make all continuing franchise fees, Brand Building Fees, and other payments to the COMPANY by electronic transfer, and any insufficiency will be considered a default in payment pursuant to Section 14.5.1 of this Agreement.
FRANCHISEE will promptly reimburse the COMPANY for any charges incurred by the COMPANY due to a shortage of funds in FRANCHISEE's account.
- 8.3.4 FRANCHISEE will maintain a single bank account for its business operations and for the payment of continuing franchise fees, Brand Building Fees or any other amounts payable to the COMPANY.
Source: Item 23 — Receipts (FDD pages 53–163)
What This Means (2025 FDD)
According to Gold Star's 2025 Franchise Disclosure Document, the continuing franchise fee must be paid via pre-authorized debit. Unless the manual states otherwise, the franchisee must pay Gold Star the continuing franchise fee on or before Tuesday of each week. The payment will be based on the gross sales for the preceding week, which ends on Sunday.
To facilitate these payments, the franchisee must complete an "Authorization for Electronic Fund Transfers" form and any other required forms. They also need to provide all necessary information to authorize electronic debits. Franchisees are expected to follow Gold Star's procedures to ensure payments are made via electronic fund transfer.
Furthermore, franchisees must maintain a business account at a bank or financial institution that is capable of electronically debiting payments. The franchisee is responsible for ensuring that the account has sufficient funds to cover the continuing franchise fees, Brand Building Fees, and any other payments due to Gold Star. Insufficient funds will be considered a default in payment, and the franchisee will be responsible for reimbursing Gold Star for any charges incurred due to the shortage of funds. Franchisees must also maintain a single bank account for their business operations and for making these payments to Gold Star.