If the Aplus Franchise Agreement is terminated but the Premises Lease is in effect, what must the franchisee do regarding motor fuel?

According to Aplus's 2024 Franchise Disclosure Document, if the Aplus Franchise Agreement is terminated but the Premises Lease and Motor Fuel Supply Agreements remain in effect, the franchisee's obligations under these agreements continue. The franchisee remains obligated to pay Sunoco a Store Facilities Rent, calculated as fourteen percent (14%) of the monthly Store Gross Sales. This calculation uses an average of the total Gross Sales for the twelve (12) month period immediately preceding the termination of the Aplus Franchise Agreement.

This means that even if the Aplus franchise agreement is terminated, the franchisee is still bound by the terms of the Premises Lease and Motor Fuel Supply Agreements. They must continue to operate the location and sell motor fuel, adhering to the stipulations of those agreements. The Store Facilities Rent ensures that Sunoco continues to receive income from the location, even without the franchise agreement in place.

This situation could arise if Aplus decides to terminate the franchise agreement due to the franchisee's poor performance or violation of the agreement's terms, but still wants the location to operate as a gas station. The franchisee would essentially become a tenant operating a gas station and convenience store, but without the Aplus branding and support. It is important for prospective franchisees to understand that termination of the franchise agreement does not automatically release them from their obligations under the Premises Lease and Motor Fuel Supply Agreements.

It is crucial for potential Aplus franchisees to carefully review all agreements, including the Franchise Agreement, Premises Lease, and Motor Fuel Supply Agreements, to fully understand their rights and obligations in the event of termination. They should also seek legal counsel to clarify any ambiguities and assess the potential risks involved.