Can a Gold Star franchisee make any set-off or deduction from amounts payable to the company?

According to Gold Star's 2025 Franchise Disclosure Document, franchisees are required to make all payments to Gold Star without any deductions or set-offs. This means a franchisee cannot withhold payments due to any disputes or alleged breaches of contract by Gold Star.

Specifically, the franchise agreement mandates that all amounts payable by the franchisee to Gold Star or its affiliates must be paid without any set-off or deduction, regardless of the reason. This includes, but is not limited to, any claims of breach of contract by Gold Star. If a franchisee fails to make payments when due, the unpaid amount will accrue interest from the due date until it is paid. The interest rate is set at 1.5% per month or the maximum rate permitted by law, whichever is less.

This requirement ensures that Gold Star receives consistent and timely payments from its franchisees, which is crucial for maintaining the financial stability of the franchise system. However, it also places a significant financial obligation on the franchisee, who must continue to make payments even if they have a dispute with Gold Star. Franchisees need to be aware of this provision and its implications for their business operations and financial planning. It is common in franchising for agreements to require payments to be unconditional, as it protects the franchisor's revenue stream.