Under what conditions can the Aplus franchisor's actions, as outlined in Section 17.1.4, continue?
Aplus Franchise · 2024 FDDAnswer from 2024 FDD Document
advertising materials, stationery, forms and any other items which display or are associated with the Marks;
- 17.1.3. Take such action as may be necessary to cancel or assign to Franchisor, at Franchisor's option, any assumed name or equivalent registration filed with state, city or county authorities which contains the name APLUS or any other Mark, and Franchisee shall furnish Franchisor with evidence satisfactory to Franchisor of compliance with this obligation within thirty (30) days after termination or expiration of this Agreement;
- 17.1.4. Pay all sums owing to Franchisor and any Affiliate, including amounts due under Section 17.2, below. In the event of termination for any default of Franchisee, such sums shall include, but not be limited to, all damages, costs and expenses, including reasonable attorneys' fees, with respect to litigation, arbitration, appellate or bankruptcy proceedings, unpaid Royalty Fees, and any other amounts due to Franchisor or any Affiliate;
Source: Item 23 — RECEIPT (FDD pages 68–302)
What This Means (2024 FDD)
According to Aplus's 2024 Franchise Disclosure Document, Section 17.1.4 outlines the franchisee's obligation to pay all sums owed to Aplus and its affiliates upon termination or expiration of the franchise agreement. This includes any amounts due under Section 17.2. If the termination results from the franchisee's default, the sums owed extend to all damages, costs, and expenses, including reasonable attorneys' fees related to litigation, arbitration, appellate, or bankruptcy proceedings. It also covers unpaid Royalty Fees and any other amounts due to Aplus or its affiliates.
Prior to the termination of the agreement, Aplus has the option to take certain actions if the franchisee fails to pay amounts owed, fails to comply with any term of the agreement, or notifies Aplus that the franchised business is closing. These actions include removing the listing of the franchised business from all advertising published or approved by Aplus and ceasing to list the franchised business on any technology platforms.
In practical terms, this means that an Aplus franchisee must remain current on all payments and adhere to the franchise agreement terms to avoid triggering these actions by Aplus. Failure to do so can result in the franchisee being responsible for significant financial burdens, especially in the event of termination due to default, where legal and other associated costs can be substantial.