Under what conditions can the two-year non-solicitation period following termination or expiration of the Aplus franchise agreement be extended?
Aplus Franchise · 2024 FDDAnswer from 2024 FDD Document
- 17.3.2. Except as otherwise approved in writing by Franchisor, neither Franchisee, nor any holder of a legal or beneficial interest in Franchisee, nor any officer, director, executive, manager, or member of the professional staff of Franchisee, shall, for a period of two (2) years after the expiration or termination of this Agreement, regardless of the cause of termination, either directly or indirectly, for themselves or through, on behalf of or in conjunction with any person or entity solicit or otherwise attempt to induce or influence any customer or other business associate of Franchisor and or APLUS and/or SUNOCO franchisees to terminate or modify his, her or its business relationship with APLUS and/or SUNOCO; or
- 17.3.4 The two (2) year period shall be tolled during any event of non-compliance.
Source: Item 23 — RECEIPT (FDD pages 68–302)
What This Means (2024 FDD)
According to Aplus's 2024 Franchise Disclosure Document, the two-year non-solicitation period can be extended if there is any event of non-compliance. This means that if a franchisee violates the terms of the restrictive covenants during that two-year period, the period will be tolled, or paused, for the duration of the non-compliance.
This extension applies to the franchisee, any holder of a legal or beneficial interest in the franchisee, and any officer, director, executive, manager, or member of the professional staff of the franchisee. The non-solicitation agreement prevents these individuals from soliciting or attempting to influence any customer or other business associate of Aplus and/or SUNOCO franchisees to terminate or modify their business relationship with Aplus and/or SUNOCO.
For a prospective Aplus franchisee, this means that any violation of the non-solicitation agreement, no matter how small, could result in the extension of the restrictive covenant period. This could significantly limit their ability to engage in competitive business activities for a longer period than initially anticipated. It is important to fully understand the scope of the non-solicitation agreement and ensure full compliance to avoid any potential extensions.