Is the Aplus franchise fee refundable if Sunoco is unable to timely undertake its construction obligations, and under what conditions?

According to the 2024 Aplus Franchise Disclosure Document, the franchise fee's refundability in cases where Sunoco is unable to fulfill its construction obligations is subject to Sunoco's discretion. Specifically, if Sunoco cannot timely meet its obligations under Section 22.1.1, a refund of the franchise fee (minus Sunoco's costs) is possible, but this refund is at Sunoco's sole discretion.

This discretionary refund policy carries significant implications for potential Aplus franchisees. It means that even if Sunoco fails to meet its construction obligations, franchisees are not automatically entitled to a refund of the franchise fee. The decision to refund, and the amount refunded (after deducting Sunoco's costs), rests entirely with Sunoco. This introduces a level of uncertainty and risk for franchisees, as they may lose their initial investment if construction delays or failures occur and Sunoco chooses not to issue a refund.

In contrast, many franchise agreements have clearer, more defined refund policies that stipulate specific conditions under which franchise fees are refundable. The Aplus agreement's discretionary clause places the franchisee in a potentially vulnerable position, dependent on Sunoco's decision regarding a refund. Prospective franchisees should carefully consider this aspect and seek clarification from Sunoco regarding the circumstances under which a refund would be granted. It would be prudent to negotiate for more specific terms or seek legal advice before entering into the franchise agreement.