For Gold Star, what is the franchisee responsible for regarding compliance of store operations?
Gold_Star Franchise · 2025 FDDAnswer from 2025 FDD Document
e, at no cost to the FRANCHISEE:
- 4.6.1 a schedule of all equipment necessary to operate the Store; and
- 4.6.2 a list of approved sources for architectural services, supplies, equipment, furniture, advertising and marketing materials, computer software and hardware, and other items necessary for the operation of the Store.
- 4.7 Pre-Construction Requirements. Prior to commencing any construction on the Store, the FRANCHISEE will comply with all of the following requirements:
- 4.7.1 the FRANCHISEE will comply with all federal, state and local laws, codes and regulations, including the applicable provisions of the ADA, regarding the construction, design and operation of the Store.
- 4.7.2 the FRANCHISEE will be responsible for obtaining all zoning classifications and clearances that may be required by state or local laws, ordinances, regulations that may be necessary or advisable owing to any restrictive covenants at the Retail Location. After having obtained such approvals and clearances, the FRANCHISEE will submit to the COMPANY, for the COMPANY's approval, final plans for construction based on the preliminary plans and specifications. The COMPANY's review and approval of plans will be limited to review of such plans to assess compliance with the COMPANY's design standards for a typical Gold Star Chili restaurant, including such items as trade dress and presentation of the Marks. The COMPANY's review is not designed to assess compliance with federal, state or local laws and regulations, including the ADA, as compliance with such laws are the sole responsibility of the FRANCHISEE. Once approved by the COMPANY, the final plans may not then be changed or modified without the prior written permission of the COMPANY.
- 4.7.3 the FRANCHISEE will obtain all permits and certifications required for the lawful construction of the Store and operation of the Business and will
- certify in writing to the COMPANY that all such permits and certifications have been obtained.
- 4.7.4 the FRANCHISEE will employ a qualified licensed general contractor who is reasonably acceptable to the COMPANY to construct the Store and to complete all improvements. The FRANCHISEE will obtain and maintain in force during the entire period of construction the insurance required by Section 18 below.
- 4.8 No Representations or Warranties. Neither the COMPANY's acceptance of any proposed site or design, assistance in evaluating or determining a site, site lease or design or any information communicated to FRANCHISEE with respect to site selection or design criteria or any proposed site, lease or design shall be interpreted as a representation, warranty or guarantee, express or implied, that a suitable site or lease can be obtained for FRANCHISEE, or that any site found, lease obtained or design used is suitable, or that operation of the Business at such site or under such design or lease shall be successful.
- 4.9 Construction Schedule. Notwithstanding the foregoing, the FRANCHISEE must complete construction of the Store and cause it to be open for business within twelve (12) months of the approval of the Retail Location.
5. STANDARDS OF OPERATION.
5.1 System Standards. FRANCHISEE acknowledges and agrees that every detail of the System is important, not only to FRANCHISEE but also to the COMPANY and other Gold Star Chili franchisees, in order to develop and maintain uniform operating standards, increase the demand for the products and services offered by all franchisees, establish and maintain a reputation for the highest degree of quality, service, cleanliness and customer satisfaction, and to protect the goodwill of all Gold Star Chili franchises. FRANCHISEE further acknowledges and agrees that a fundamental requirement of the System, this Agreement, and other Gold Star Chili franchises is adherence by all franchisees to the uniform specifications, standards, operating procedures and rules prescribed by the COMPANY for the development and operation of the Store, including, without limitation, standards and specifications regarding ingredients, methods of food preparation and service, and weight, quality and dimensions of menu items and other products served in the Store (collectively referred to as "System Standards"). Accordingly, FRANCHISEE will conduct and operate the Business at all times in a manner that will preserve and build the goodwill of all Restaurants and of the COMPANY, will comply with each and every System Standard, as periodically modified and supplemented by the COMPANY in its sole and absolute discretion, and will not deviate from the System Standards during the term of this Agreement. System Standards prescribed from time to time in the Manual or otherwise communicated to FRANCHISEE in writing will constitute provisions of this Agreement as if fully set forth in this Agreement. All references to this Agreement include all System Standards as periodically modified.
- 5.2 Managers.
Source: Item 23 — Receipts (FDD pages 53–163)
What This Means (2025 FDD)
According to Gold Star's 2025 Franchise Disclosure Document, franchisees bear significant responsibility for ensuring their store's compliance with all applicable laws and regulations. This includes paying all taxes, assessments, and debts when due, as well as adhering to all federal, state, and local laws and regulations. These laws encompass a wide range of areas, including the Americans with Disabilities Act (ADA), Title VII of the Civil Rights Act, the Age Discrimination in Employment Act, employment laws related to taxes and withholdings, occupational health and safety, food dispensing, consumer protection, trade regulation, employment discrimination, and sexual harassment. Franchisees must also obtain all necessary permits, certificates, registrations, and licenses for the construction, refurbishment, and operation of the store. Gold Star makes it clear that franchisees are solely responsible for compliance and that Gold Star has no obligation in this regard.
Prior to construction, the franchisee must comply with all federal, state, and local laws, codes, and regulations, including ADA provisions, regarding the store's construction, design, and operation. The franchisee is responsible for obtaining all required zoning classifications and clearances. While Gold Star reviews and approves final construction plans to ensure compliance with their design standards, this review does not assess compliance with laws and regulations, which remains the franchisee's responsibility.
Gold Star also requires franchisees to operate their businesses according to the System Standards, which are detailed in the manual and may be modified periodically. If a franchisee fails to meet these standards, Gold Star will notify them and allow a period (no less than 30 days) for correction, although immediate action may be taken if public health and safety are at risk. If the franchisee does not correct the deficiencies, Gold Star may take corrective action themselves, charging the franchisee 125% of all expenses incurred or a daily fee of $100 for each day the deficiencies remain uncorrected. Franchisees must also notify Gold Star within five days of any legal actions or governmental orders that could affect the store's operation or financial condition.