Under what condition will Aplus reimburse a franchisee for out-of-pocket litigation costs related to the Marks or Copyrighted Works?

According to Aplus's 2024 Franchise Disclosure Document, Aplus will reimburse a franchisee for out-of-pocket litigation costs related to the Marks or Copyrighted Works if the litigation arises from actions the franchisee takes to defend or prosecute the Marks or Copyrighted Works at Aplus's direction. However, this reimbursement is contingent on the franchisee's use of the Marks or Copyrighted Works being consistent with the terms of the franchise agreement.

Specifically, the franchisee must sign all required documents and perform all actions Aplus deems necessary for the defense or prosecution. This may include becoming a nominal party in legal action. The reimbursement is provided only if the franchisee's use of the Marks or Copyrighted Works aligns with the franchise agreement terms.

Conversely, if the litigation results from the franchisee using the Marks or Copyrighted Works in a manner inconsistent with the franchise agreement, Aplus will not reimburse the franchisee. Instead, the franchisee will be responsible for covering all defense costs, including any judgments or settlements. This condition highlights the importance of adhering strictly to the terms of the franchise agreement regarding the use of Aplus's Marks and Copyrighted Works to avoid potential financial liabilities.