Can a Gold Star franchisee lease property to a similar business during the term of the franchise agreement?

According to Gold Star's 2025 Franchise Disclosure Document, the franchise agreement includes lease provisions that restrict the use of the premises solely to the operation of the franchised business. This means a Gold Star franchisee cannot lease the property to a similar business during the term of the franchise agreement.

Specifically, Exhibit B to the Franchise Agreement outlines several lease provisions. One key provision restricts the use of the premises solely to the operation of the franchised Gold Star business. This clause ensures that the Retail Location is exclusively used for the Gold Star franchise and prevents the franchisee from leasing the property to a competing business or any other type of business that is not part of the Gold Star system.

This restriction is in place to protect Gold Star's brand integrity and prevent direct competition within the same location. It ensures that the franchisee's efforts are focused solely on operating and promoting the Gold Star business, maintaining the quality and uniformity of the brand. This is a common practice in franchising to maintain brand consistency and prevent conflicts of interest.