What options does Gold Star have regarding the franchisee's business after termination, as referenced in Section 15.2?
Gold_Star Franchise · 2025 FDDAnswer from 2025 FDD Document
ed, without the posting of any bond or security, to apply for an order enjoining any such breach or threatened breach or orders of specific performance enforcing the provisions of this Agreement, to obtain an immediate injunction for the appointment of a receiver for FRANCHISEE's business in order to enforce such provisions, to prevent or terminate any existing or threatened violation or default on the part of FRANCHISEE, or if the Agreement has been terminated, the FRANCHISEE may be enjoined from any continued operation of the Store, or any other operation in violation of this Agreement.
15. RIGHTS AND OBLIGATIONS OF PARTIES ON TERMINATION OR EXPIRATION.
- 15.1 De-Identification; Wind-Down of Business. Upon the termination or expiration of this Agreement, or upon the permanent closing or abandonment of the Store or the Business, the following provisions shall apply:
- 15.1.1 All rights, privileges and licenses granted by the COMPANY to FRANCHISEE will immediately cease, be null and void, and of no further force and effect, and all such privileges and licenses will immediately revert to the COMPANY.
- 15.1.2 FRANCHISEE shall immediately discontinue the use of the System and the Marks. All rights granted herein with respect to the Marks and System shall thereupon be deemed canceled and terminated.
- 15.1.3 Unless FRANCHISEE receives written notice of the COMPANY's exercise of its options set forth in Section 15.2 below, after thirty (30) days have elapsed since the effective date of termination, FRANCHISEE shall immediately remove the Marks from all buildings, signs, fixtures and furnishings, and within thirty (30) days' after written notice from the COMPANY, alter and paint all structures and other improvements maintained pursuant to this Agreement a design and color which is basically different from the COMPANY's authorized building design and painting schedule and otherwise assist COMPANY in every way possible to bring about a complete and effective wind-down and de-identification of the Business.
Source: Item 23 — Receipts (FDD pages 53–163)
What This Means (2025 FDD)
According to Gold Star's 2025 Franchise Disclosure Document, Section 15.1.3 outlines the franchisee's responsibilities upon termination or expiration of the franchise agreement, unless the franchisee receives written notice of Gold Star's exercise of its options as detailed in Section 15.2. If Gold Star exercises these options, the franchisee must fulfill the requirements as directed by Gold Star.
Specifically, if Gold Star does not exercise its options, the franchisee is required to remove Gold Star's trademarks from all buildings, signs, fixtures, and furnishings within thirty days after the termination date. Additionally, within thirty days of receiving written notice from Gold Star, the franchisee must alter and repaint all structures to a design and color that differs significantly from Gold Star's authorized design and painting scheme. The franchisee must also assist Gold Star in winding down and de-identifying the business.
If the franchisee fails to comply with these removal, alteration, or repainting requirements, Gold Star has the right to enter the retail location and perform these actions at the franchisee's expense. The franchisee is obligated to pay these expenses upon demand from Gold Star. The FDD also states that the franchisee does not waive any rights they may have under any Franchise Law.