After the Aplus franchise agreement expires or terminates, for how long is the franchisee prohibited from soliciting Aplus customers or business associates?
Aplus Franchise · 2024 FDDAnswer from 2024 FDD Document
- 17.3.2. Except as otherwise approved in writing by Franchisor, neither Franchisee, nor any holder of a legal or beneficial interest in Franchisee, nor any officer, director, executive, manager, or member of the professional staff of Franchisee, shall, for a period of two (2) years after the expiration or termination of this Agreement, regardless of the cause of termination, either directly or indirectly, for themselves or through, on behalf of or in conjunction with any person or entity solicit or otherwise attempt to induce or influence any customer or other business associate of Franchisor and or APLUS and/or SUNOCO franchisees to terminate or modify his, her or its business relationship with APLUS and/or SUNOCO; or
- 17.3.3 In furtherance of this Section 17, Franchisor has the right to require certain individuals to execute standard form nondisclosure agreements in a form the same as or similar to the Nondisclosure Agreement attached as Attachment 2.
- 17.3.4 The two (2) year period shall be tolled during any event of non-compliance.
Source: Item 23 — RECEIPT (FDD pages 68–302)
What This Means (2024 FDD)
According to Aplus's 2024 Franchise Disclosure Document, franchisees face restrictions on soliciting customers or business associates after the franchise agreement ends. Specifically, for a period of two years after the expiration or termination of the agreement, the franchisee, along with anyone holding a legal or beneficial interest in the franchise, or any officer, director, executive, manager, or member of the professional staff, is prohibited from directly or indirectly soliciting or attempting to influence any customer or business associate of Aplus or its franchisees to terminate or modify their relationship with Aplus. This restriction applies regardless of the reason for the termination.
This non-solicitation clause is designed to protect Aplus's trade secrets, goodwill, and confidential information, as well as to maintain its contractual relationships with other franchisees. It also serves to protect Aplus against the costs associated with training the franchisee and their staff. The two-year period during which these restrictions are in place can be extended if the franchisee fails to comply with these terms, meaning the clock pauses during any period of non-compliance.
For a prospective Aplus franchisee, this means that upon leaving the Aplus system, they must avoid any actions that could be seen as poaching customers or business partners from Aplus. This could significantly limit their business activities for two years, especially if they choose to remain in the same geographic area or industry. It is important to fully understand the scope of these restrictions and how they might impact future business ventures after the franchise agreement concludes.