Under what condition might Sunoco issue a written default notice to an Aplus franchisee?
Aplus Franchise · 2024 FDDAnswer from 2024 FDD Document
1.29 Default Notices
- (A) If you are in default of a provision of this Lease, Sunoco may issue you a written default notice.
- (B) If Sunoco issues you a written default notice for your breach of any provision of this Lease, and, if after forty-eight (48) hours from receipt of the default notice, you have not cured the breach, Sunoco may, at its sole discretion, perform the necessary work to cure the condition and charge you for the reasonable costs incurred by Sunoco in performing the work.
- (C) Sunoco reserves the right to assess an additional Royalty Fee of one percent (1%) of your total Gross Sales in any month in which a default notice is issued on any deficiency for which a previous default notice had been issued within a twelve (12) month period. This additional one percent (1%) Monthly Royalty Fee shall be assessed on your total Gross Sales for the month in which the second default is issued and will be collected in the month following the notice of assessment to you.
- (D) The remedies set forth in (B) and (C) above are in addition to and not in waiver of Sunoco's other rights and remedies arising from such default(s) including termination or nonrenewal of this Lease.
Source: Item 23 — RECEIPT (FDD pages 68–302)
What This Means (2024 FDD)
According to Aplus's 2024 Franchise Disclosure Document, Sunoco may issue a written default notice to an Aplus franchisee if the franchisee is in default of a provision of the lease. If, after 48 hours from receipt of the default notice, the franchisee has not corrected the breach, Sunoco has the option to perform the necessary work to correct the condition and charge the franchisee for the reasonable costs incurred.
In addition to the costs for the work performed, Sunoco reserves the right to assess an additional Royalty Fee of one percent of the franchisee's total Gross Sales in any month in which a default notice is issued on any deficiency for which a previous default notice had been issued within a twelve-month period. This additional one percent Monthly Royalty Fee will be assessed on the franchisee's total Gross Sales for the month in which the second default is issued and will be collected the month following the notice of assessment.
The remedies Sunoco has are in addition to and not in waiver of Sunoco's other rights and remedies arising from such defaults, including termination or nonrenewal of the lease. This means that Aplus franchisees need to be diligent in adhering to the terms of their lease agreement to avoid potential default notices, associated costs, and potential termination of their lease.