Does the Aplus franchise agreement intend to confer any rights or remedies to individuals or entities other than the Franchisor, Franchisee, and their respective successors and assigns as contemplated by the agreement?
Aplus Franchise · 2024 FDDAnswer from 2024 FDD Document
ge, operate, or perform services, consult with, or be employed by or for any Competitive Business located within 20 miles of the Franchised Business or any other APLUS store, for two years after termination or expiration of this Agreement; a Competitive Business that is owned by Franchisee or an affiliate at the time of the termination is excepted from this restriction. The two-year period shall be tolled during any event of non-compliance.
7.4. Nondisclosure Agreements with Certain Individuals
Franchisor has the right to require any holder of a legal or beneficial interest in Franchisee (and any member of their immediate families or households), and any officer, director, executive, manager, or member of the professional staff and all employees of Franchisee to execute a nondisclosure agreement, in a form the same as or similar to the Non-Disclosure Agreement attached as Attachment 2, upon execution of this Agreement or prior to each such person's affiliation with Franchisee. Upon Franchisor's request, Franchisee shall provide Franchisor with copies of all Non-Disclosure agreements signed pursuant to this Section 7.4. Such agreements shall remain on file at the offices of Franchisee and are subject to audit or review as otherwise set forth herein. Franchisor shall be a third party beneficiary with the right to enforce covenants contained in such agreements.
7.5. Reasonableness of Restrictions
Franchisee acknowledges that the restrictive covenants contained in this Section 7 are essential elements of this Agreement and that without their inclusion, Franchisor would not have entered into this Agreement. Franchisee acknowledges that each of the terms set forth herein, including the restrictive covenants, is fair and reasonable and is reasonably required for the protection of Franchisor, the System, the Marks, Franchisor's goodwill, and Franchisor's franchise system; and Franchisee expressly waives any right to challenge these restrictions as being overly broad, unreasonable, overly burdensome or otherwise unenforceable. Franchisee affirms that it has other means of earning a living from its employment experience prior to becoming a franchisee.
8. TRAINING AND ASSISTANCE
8.1. Initial Training
Franchisor shall make an initial training program available to your Designated Manager and two (2) other individuals who will be directly involved in the operation of the APLUS Store. Prior to the opening of the Franchised Business, the Designated Manager must attend and successfully complete initial training to Franchisor's satisfaction, including the passing of tests at the end of initial training. Franchisor shall conduct the initial training program at its headquarters, designated regional office, or at another designated location or in another format (including digitally or virtually) as Franchisor may designate at its sole option. Franchisor shall not charge tuition or similar fees for initial training, however, all expenses incurred by Franchisee in attending such program including, but not limited to, travel costs, room and board expenses and employees' salaries or wages, shall be the sole responsibility of Franchisee.
Source: Item 23 — RECEIPT (FDD pages 68–302)
What This Means (2024 FDD)
According to Aplus's 2024 Franchise Disclosure Document, the franchise agreement does grant some rights to third parties. Specifically, Aplus may utilize Area Representatives to assist in offering franchises and servicing Aplus stores. These Area Representatives are independent contractors who may be compensated with a percentage of the initial franchise fee or monthly royalty fees. If rights are assigned to the Area Representative, the franchisee must remit payments directly to them.
Additionally, if an Aplus store is located in an Area Representative's territory, a substantial amount of the services required to be provided to the franchisee by Aplus may be provided by the Area Representative. The franchisee must allow the Area Representative the same access to the Aplus store for inspections and other visits as if the Area Representative were an employee of Aplus. The franchisee cannot deny the Area Representative admittance based on inadequate notice or other issues related to the Area Representative's duties.
Furthermore, Aplus has the right to require any holder of a legal or beneficial interest in the franchisee, their immediate family members, and any officer, director, executive, manager, professional staff, and all employees of the franchisee to execute a nondisclosure agreement. Aplus is considered a third-party beneficiary with the right to enforce the covenants contained within these nondisclosure agreements. This means Aplus can directly pursue legal action to enforce these agreements even though they are not a direct party to the agreement between the franchisee's personnel and the franchisee itself.