What happens if Sunoco refuses consent to an Aplus franchisee's proposed lease assignment?
Aplus Franchise · 2024 FDDAnswer from 2024 FDD Document
If Sunoco refuses consent, the terms of the first Section of this Section 2.22 shall apply.
Sunoco may withhold its consent to a proposed assignment if Sunoco's then-current requirements are not satisfied.
Such requirements may include the requirement that a transfer fee or other fees be paid.
- (I) SUNOCO RESERVES THE RIGHT TO REFUSE TO CONSENT TO ANY PROPOSED TRANSFER OR ASSIGNMENT THAT WOULD RESULT IN SUNOCO HAVING ANY MATERIAL INCREASED RISK, BURDEN, OR CHANCE OF NOT OBTAINING PERFORMANCE.
SUNOCO SHALL NOT BE HELD LIABLE FOR ANY LOSSES CAUSED TO YOU DUE TO DISAPPROVAL OR CONDITIONAL APPROVAL.
- (J) If you assign this Lease in connection with an assignment of the APlus Franchise Agreement, you shall comply with the provisions of the APlus Franchise Agreement regarding assignment.
Compliance with such provisions shall be deemed to satisfy the requirements of this Section, notwithstanding any provisions of this Lease to the contrary.
Source: Item 23 — RECEIPT (FDD pages 68–302)
What This Means (2024 FDD)
According to Aplus's 2024 Franchise Disclosure Document, if Sunoco refuses consent to a proposed lease assignment, the terms of the first Section of Section 2.22 of the lease agreement will apply. The FDD does not elaborate on what those terms are. Sunoco may withhold consent if its current requirements are not met, potentially including the payment of a transfer fee or other fees. Sunoco also reserves the right to refuse consent if the assignment would materially increase Sunoco's risk, burden, or chance of non-performance.
The document explicitly states that Sunoco will not be held liable for any losses incurred by the franchisee due to disapproval or conditional approval of a lease assignment. If the lease assignment is connected to an Aplus Franchise Agreement assignment, compliance with the Franchise Agreement's provisions regarding assignment will satisfy the lease requirements, regardless of any conflicting lease terms.
Prospective Aplus franchisees should be aware that Sunoco has significant control over lease assignments and can refuse consent under various circumstances. This could impact a franchisee's ability to sell or transfer their business. It is crucial to carefully review the terms of the lease agreement and understand Sunoco's requirements for lease assignments to avoid potential issues in the future. Franchisees should also inquire about the specific terms outlined in the first Section of Section 2.22 to fully understand their rights and obligations in the event of a refused lease assignment.