For Aplus, who must own all the equity and voting power of the outstanding stock or other capital interest in the Controlled Entity?

According to Aplus's 2024 Franchise Disclosure Document, if a franchisee chooses to operate their Aplus store through a Controlled Entity, the franchisee or all holders of a legal or beneficial interest in the franchisee must own all of the equity and voting power of the outstanding stock or other capital interest in that Controlled Entity.

This requirement ensures that the franchisee maintains full control over the Aplus business, even when operating through a separate legal entity. This is a common practice in franchising, as franchisors like Aplus want to ensure that the individuals they initially approve are the ones making the key decisions for the franchise.

Furthermore, the Controlled Entity must be newly organized with its activities confined exclusively to operating the Aplus franchised business. This prevents the franchisee from using an existing business entity for the Aplus franchise, which could potentially dilute the focus on the Aplus business or create conflicts of interest. All obligations of the franchisee to Aplus must be fully paid and satisfied, and the franchisee must pay the transfer fee listed in the Summary Page. This ensures that the franchisee is in good standing with Aplus before the transfer to the Controlled Entity is approved.