What must a Gold Star franchisee deliver to the company at no cost after termination or expiration?
Gold_Star Franchise · 2025 FDDAnswer from 2025 FDD Document
- 26. SURVIVAL OF TERMS AND CONDITIONS. The obligations of FRANCHISEE under Sections 11, 12, 16, and 19.3 hereof, and any other FRANCHISEE obligations herein that are stated to, or are of a type that would reasonably, survive or apply beyond termination or expiration of this Agreement, shall survive any termination or expiration of this Agreement; and expiration or termination of this Agreement shall be without prejudice to the rights of the COMPANY against FRANCHISEE thereunder and with respect to other like matters that reasonably would survive the end of a franchise relationship, and shall not relieve FRANCHISEE of any of FRANCHISEE's obligations to the COMPANY existing at the time of expiration or termination.
- 27. EXPENSES. If the COMPANY incurs any costs or expenses (including but not limited to attorneys' fees, court costs, other litigation expenses, settlement expenses or other expenses of any kind) in enforcing or protecting the COMPANY's rights under this Agreement, or any judgments, orders or awards relating thereto, or in preparation for or investigation or contemplation thereof, the COMPANY shall be entitled to recover from FRANCHISEE all such costs and expenses on demand, with interest from the date due pursuant to Section 8.3, above.
Source: Item 23 — Receipts (FDD pages 53–163)
What This Means (2025 FDD)
Based on the 2025 Gold Star Franchise Disclosure Document, the franchisee has obligations that survive the termination or expiration of the franchise agreement. Specifically, the franchisee must adhere to sections 11, 12, 16, and 19.3 of the agreement, as well as any other obligations that would reasonably apply beyond the termination or expiration of the agreement. The termination or expiration of the agreement does not relieve the franchisee of any obligations to Gold Star existing at the time of termination or expiration.
Additionally, if Gold Star incurs any costs or expenses while enforcing or protecting its rights under the agreement, the franchisee is responsible for covering these costs. These expenses include, but are not limited to, attorney's fees, court costs, litigation expenses, and settlement expenses. The franchisee is required to pay these costs on demand, along with interest accruing from the date the payment was originally due.
In practical terms, this means that even after a Gold Star franchise closes, the franchisee may still have financial and legal responsibilities to the franchisor. A prospective franchisee should carefully review sections 11, 12, 16, and 19.3 of the franchise agreement to fully understand the obligations that survive termination or expiration. Furthermore, it is important to understand the circumstances under which Gold Star might seek to enforce its rights and the potential costs associated with such actions.