Does any circumstance that might constitute a defense for the borrower affect the Aerus guarantee?
Aerus Franchise · 2025 FDDAnswer from 2025 FDD Document
- (b) No invalidity, irregularity or unenforceability of all or any part of the Guaranteed Obligations shall affect, impair or be a defense to this Guarantee, nor shall any other circumstance which might otherwise constitute a defense available to or legal or equitable discharge of Borrower in respect of any of the Guaranteed Obligations, or Guarantor in respect of this Guarantee, affect, impair or be a defense to this Guarantee.
Source: Item 23 — Receipts (FDD pages 74–305)
What This Means (2025 FDD)
According to Aerus's 2025 Franchise Disclosure Document, the validity and enforceability of the guarantee are not affected by any potential defenses the borrower might have. The guarantor's obligations remain in effect regardless of circumstances that could otherwise discharge the borrower's responsibilities. This means that even if the borrower has a legal reason to avoid payment, the guarantor is still responsible for fulfilling the guaranteed obligations to the lender.
Specifically, the guarantee remains valid even if any part of the guaranteed obligations is considered invalid, irregular, or unenforceable. This ensures that the lender is protected, and the guarantor cannot use the borrower's potential defenses as a reason to avoid their obligations under the guarantee. This clause reinforces the absolute and unconditional nature of the guarantee, as outlined in another section.
This aspect of the Aerus franchise agreement places a significant responsibility on the guarantor. Before signing the guarantee, potential guarantors should carefully consider the financial stability and creditworthiness of the borrower, as they will be held responsible for the debt regardless of the borrower's circumstances. It is advisable for the guarantor to seek independent legal and financial advice to fully understand the implications of this guarantee.