During the Interim Period for an Aplus franchise, what obligations of the Franchisee remain in effect?
Aplus Franchise · 2024 FDDAnswer from 2024 FDD Document
If this Agreement expires without Franchisee properly exercising its renewal right and Franchisee continues to accept the benefits of this Agreement thereafter, then, at Franchisor's sole option, Franchisor may treat this Agreement either as: (i) expired as of the date of expiration, with Franchisee then illegally operating a franchise without a license to do so, in violation of Franchisor's rights and this Agreement; or (ii) continued on a month-to-month basis (the "Interim Period") until one (1) party provides the other with written notice of such party's intent to terminate the Interim Period, in which case, the Interim Period will terminate thirty (30) days after the other party's receipt of the notice to terminate the Interim Period or, if Franchisee's jurisdiction requires a termination notice period longer than thirty (30) days, the period will be the minimum notice period required by the laws of such jurisdiction. In the latter case, all obligations of Franchisee shall remain in full force and effect during the Interim Period as if this Agreement had not expired, and all obligations and restrictions imposed on Franchisee upon expiration of the Agreement shall take effect upon termination of the Interim Period.
Source: Item 23 — RECEIPT (FDD pages 68–302)
What This Means (2024 FDD)
According to Aplus's 2024 Franchise Disclosure Document, the Interim Period occurs if a franchisee continues to operate after the franchise agreement expires but has not properly exercised their renewal right. During this Interim Period, Aplus has the option to treat the agreement as either expired, meaning the franchisee is illegally operating without a license, or continued on a month-to-month basis.
If Aplus chooses to continue the agreement on a month-to-month basis, all of the franchisee's obligations remain in full force and effect. This means the franchisee must continue to adhere to all the terms and conditions of the original franchise agreement as if it had not expired.
Upon termination of the Interim Period, all obligations and restrictions imposed on the franchisee upon the expiration of the agreement will take effect. The Interim Period will end thirty days after one party notifies the other of their intent to terminate, unless the franchisee's jurisdiction requires a longer notice period, in which case the minimum notice period required by law will apply.