If an Aplus franchisee is a Business Entity and intends to issue equity interests, what is required?
Aplus Franchise · 2024 FDDAnswer from 2024 FDD Document
- 8.8.
Private or Public Offerings.
If you are a Business Entity and you intend to issue equity interests pursuant to a private or public offering, you shall first obtain Franchisor's written consent, which consent shall not be unreasonably withheld.
You must provide to Franchisor for its review a copy of all offering materials (whether or not such materials are required by applicable securities laws) at least 60 days prior to such documents being filed with any government agency or distributed to investors.
Source: Item 22 — CONTRACTS (FDD page 68)
What This Means (2024 FDD)
According to the 2024 Aplus Franchise Disclosure Document, if a franchisee is a Business Entity and plans to issue equity interests through a private or public offering, they must first obtain written consent from Aplus. This consent will not be unreasonably withheld.
Prior to filing any offering materials with a government agency or distributing them to investors, the franchisee must provide Aplus with a copy of all offering materials for review. This submission must be made at least 60 days in advance.
This requirement allows Aplus to protect its brand and ensure that potential investors are fully informed about the franchise opportunity. It also gives Aplus the opportunity to assess whether the offering could negatively impact the franchise system. Franchisees should factor this 60-day review period into their timelines when planning any equity offerings.