Does Gold Star review and approve or reject the franchisee's proposed lease?
Gold_Star Franchise · 2025 FDDAnswer from 2025 FDD Document
- 6. Review and approve or reject your proposed Retail Location and lease, if any. Site review is sometimes performed before the execution of the Franchise Agreement, and is typically a post-signing activity (Sections 4.2 and 4.3 of the Franchise Agreement).
Any lease for the Retail Location also must be acceptable to Gold Star and contain such provisions as Gold Star requires pursuant to the Franchise Agreement. We may require that you use leasing counsel approved or designated by us to represent you in the negotiation of the lease for your Franchise. Leasing counsel fees typically range from $2,500 to $3,500.
If you and Gold Star enter into a Franchise Agreement before you complete the site selection process and if your Retail Location is not selected and approved (together with any lease) within 6 months of the execution of the Franchise Agreement, you will be in default of the Franchise Agreement. If you fail to open your franchised Restaurant for business within twelve (12) months of the approval of your Retail Location, you will be in default of the Franchise Agreement. You will have 10 days after receipt of Gold Star's written notice of default to remedy the default. If the default is not remedied timely and satisfactorily, Gold Star may terminate your Franchise Agreement, at its option.
Each Franchise is granted only for a single Restaurant at a specified Retail Location. You select your site subject to Gold Star's approval. Gold Star can refuse to approve any proposed Retail Location for any reason or no reason solely in its discretion; and rejection need not be justified by any standard. Some factors considered by Gold Star in evaluating a proposed Retail Location include suitability of the neighborhood, proximity to other restaurants, population density, traffic flow, parking, customer draws in the immediate area and visibility of the proposed Retail Location from streets and parking facilities. If Gold Star rejects a proposed Retail Location, you will have to locate a new proposed Retail Location that is not rejected.
Source: Item 11 — Franchisor's Assistance, Advertising, Computer Systems, and Training (FDD pages 26–36)
What This Means (2025 FDD)
According to the 2025 Gold Star Franchise Disclosure Document, Gold Star must review and approve or reject a franchisee's proposed retail location and lease. This site review can occur before or after the Franchise Agreement is signed.
Gold Star can refuse to approve a proposed retail location for any reason, and is not required to justify its rejection. Factors Gold Star considers include the suitability of the neighborhood, proximity to other restaurants, population density, traffic flow, parking, customer draws, and visibility of the proposed location. If Gold Star rejects a proposed location, the franchisee must find a new location.
The lease for the retail location must be acceptable to Gold Star and contain provisions Gold Star requires. Gold Star may require franchisees to use leasing counsel approved or designated by them to negotiate the lease, with leasing counsel fees typically ranging from $2,500 to $3,500. Franchisees risk defaulting on the Franchise Agreement if a retail location and lease are not approved within 6 months of signing the Franchise Agreement, or if the restaurant does not open within 12 months of location approval. Failure to remedy the default within 10 days of written notice may result in termination of the Franchise Agreement.