factual

Can Aplus require franchisees to purchase specific computer hardware and software?

Aplus Franchise · 2024 FDD

Answer from 2024 FDD Document

or shall have the right to release financial and operational information relating to the Franchised Business to Franchisor's lenders or prospective lenders. Franchisee shall certify as true and correct all reports to be submitted pursuant to this Agreement. If Franchisee fails to submit any required reports under this Agreement within three (3) business days of the due date, a late reporting fee of $250 per report per incident applies, which is payable to Franchisor upon demand.

12.5. Software and Technology

During the term of this Agreement, Franchisor reserves the right to require Franchisee to purchase, install and use computer equipment consisting of hardware and software in accordance with Franchisor's

then-current specifications. This may include a business management and accounting software providing customer relationship management, scheduling, inventory, and data management services. Franchisor may change the software or technology that Franchisee must use at any time, and pass through costs to the Franchisee plus a reasonable administrative fee for use of the software and technology. Franchisor may also develop proprietary software or technology that must be used by franchisees as required. If this occurs, Franchisee agrees to enter into a license agreement with Franchisor (or an affiliate of Franchisor) and pay Franchisor (or Franchisor's affiliate) commercially reasonable licensing, support and maintenance fees. The terms of the license agreement will govern the terms pursuant to which Franchisee may utilize this software or technology. Franchisor also reserves the right to enter into a master software or technology license agreement with a third party licensor and then sublicense the software or technology to Franchisee, in which case Franchisor may charge Franchisee for all amounts that we must pay to the licensor based on Franchisee's use of the software or technology plus a reasonable administrative fee. All fees referenced in this Section 12.5 are due on or before 5:00PM CST on the day of each month that we specify from time to time. Franchisor shall have full access to all of Franchisee's computer, data and systems and all related information by means of direct access, either in person or by telephone, modem or Internet to permit Franchisor to verify Franchisee's compliance with its obligations under this Agreement.

12.6. Right to Inspect

  • 12.6.1. Franchisor or its designee has the right, during normal business hours, to examine, copy and audit the books, financial data, business records, and tax returns of Franchisee. If the audit or any other inspection should reveal that any payments to Franchisor have been underpaid, then Franchisee shall immediately pay to Franchisor the amount of the underpayment plus interest from the date such amount was due until paid at the rate of the highest rate allowed by the law of the state where Franchisee is located. In the event Franchisee's books and records are missing or incomplete for Franchisor's review at the time of any scheduled audit, Franchisee shall be required to reimburse Franchisor for the costs of said audit.

Source: Item 23 — RECEIPT (FDD pages 68–302)

What This Means (2024 FDD)

According to Aplus's 2024 Franchise Disclosure Document, Aplus franchisees are required to purchase specific computer hardware and software. Aplus reserves the right to mandate the purchase, installation, and use of specific computer equipment, including both hardware and software, that adheres to their current specifications. This may include business management and accounting software that provides customer relationship management, scheduling, inventory, and data management services.

Aplus retains the flexibility to modify the required software or technology at any given time and can pass the associated costs, along with a reasonable administrative fee, to the franchisee. They may also develop proprietary software or technology that franchisees are obligated to use. In such instances, franchisees must enter into a license agreement with Aplus (or an affiliate) and pay commercially reasonable licensing, support, and maintenance fees. Aplus also reserves the right to enter into master software license agreements with third-party licensors and sublicense the software to franchisees, charging franchisees the amounts Aplus pays to the licensor plus an administrative fee.

Furthermore, Aplus will have full access to the franchisee's computer systems, data, and related information to verify compliance with the franchise agreement. Franchisees are also obligated to maintain an email address and account as per Aplus's specifications for communication purposes. The franchisee is responsible for the acquisition, operation, maintenance, updates, and upgrades of the computer system, ensuring it meets Aplus's standards and interfaces correctly with Aplus's and third-party systems. The franchisee bears the consequences of any failures in operating, maintaining, or upgrading the computer system, including issues like viruses and spyware.

Disclaimer: This information is extracted from the 2024 Franchise Disclosure Document and is provided for research purposes only. It does not constitute legal or financial advice. Consult with a franchise attorney before making any investment decisions.