What are the minimum conditions for Gold Star's approval of a franchise transfer?
Gold_Star Franchise · 2025 FDDAnswer from 2025 FDD Document
| Provision | Section in | Summary |
|---|---|---|
| Franchise Agreement | ||
| i. Your obligations on termination/nonrenewal | Section 15 | Obligations include complete deidentification; payment of amounts due; return of proprietary and other confidential items, as well as all inventory and equipment bearing the Marks; transfer of phone listings and numbers; confidentiality obligations; indemnity obligations (also see (o) and (r), below) |
| j. Assignment of contract | Section 13.1 | No restriction on Gold Star's right to assign |
| by Gold Star | ||
| k. “Transfer” by you - | Section 13.2 | Includes transfer of contract or assets, certain ownership |
| definition | changes, grant of liens | |
| l. Gold Star’s approval of transfer by Franchisee | Section 13.4 and the Small Business Association Addendum if applicable | Gold Star has the right to approve all transfers (also see (n) below) |
| m. Conditions for Gold Star approval of transfer | Section 13.4 and the Small Business Association Addendum if applicable | Gold Star not obligated to approve any transfer--minimum conditions include: you are in good standing; new franchisee qualifies; transfer fee paid; purchase agreement approved; training arranged; release signed by you (and your shareholders and partners) and current agreement and related documents signed by new franchisee (also see (n) and (r), below); Under the Small Business Association Addendum, Gold Star may not unreasonably withhold, condition, or delay its consent. |
Source: Item 17 — Renewal, Termination, Transfer, and Dispute Resolution (FDD pages 42–45)
What This Means (2025 FDD)
According to Gold Star's 2025 Franchise Disclosure Document, Gold Star has the right to approve all franchise transfers. However, Gold Star is not obligated to approve any transfer.
The minimum conditions for Gold Star's approval include that the franchisee is in good standing. The new franchisee must also qualify under Gold Star's standards. Additionally, the transfer fee must be paid to Gold Star.
A purchase agreement must be approved by Gold Star, and training must be arranged for the new franchisee. The existing franchisee, along with their shareholders and partners, must sign a release. The current agreement and related documents must be signed by the new franchisee.
It is important to note that under the Small Business Association Addendum, Gold Star may not unreasonably withhold, condition, or delay its consent to the transfer.