What is a condition that would prevent an Aerus franchisee from renewing their franchise agreement?
Aerus Franchise · 2025 FDDAnswer from 2025 FDD Document
| Category | Section in Agreement | Summary |
|---|---|---|
| b. Renewal or extension of the term | Section 2 and Schedule 1 | If we are then offering new franchise rights for the establishment of Aerus Businesses in the State where the franchise subject to renewal is located and you satisfy the requirements for renewal, you may renew for an additional one (1) year renewal term. |
| c. Requirements for franchisee to renew or extend | Section 2 | Provided we are then offering new franchise rights for the establishment of Aerus Businesses in the State where the franchise subject to renewal is located, you may renew subject to the following conditions: (1) you give us written notice of your desire to renew 30 days before expiration of the initial term; (2) there is no uncured default at the time of renewal; (3) you have achieved at least $10,000 in monthly Gross Sales during each of the prior six months; (4) you execute our then-current form of franchise agreement (which may contain materially different terms and conditions than your original Franchise Agreement); (5) you pay a $100 renewal fee; and (6) you, your principals, and your guarantors sign a general release in favor of us and our affiliates. |
Source: Item 17 — Renewal, Termination, Transfer, and Dispute Resolution (FDD pages 56–60)
What This Means (2025 FDD)
According to Aerus's 2025 Franchise Disclosure Document, several conditions could prevent a franchisee from renewing their franchise agreement. Aerus may deny renewal if there is an uncured default at the time of renewal. Additionally, to be eligible for renewal, the franchisee must have achieved at least $10,000 in monthly Gross Sales during each of the prior six months. The franchisee must also provide written notice of their desire to renew 30 days before the expiration of the initial term.
Furthermore, as a condition of renewal, the franchisee must execute Aerus's then-current form of franchise agreement, which may contain materially different terms and conditions than the original agreement. The franchisee is also required to pay a $100 renewal fee. Finally, the franchisee, their principals, and their guarantors must sign a general release in favor of Aerus and its affiliates.
These conditions are typical in franchise agreements, as franchisors want to ensure that franchisees are performing well and are in good standing before renewing their agreements. The financial performance requirement ensures that the franchisee's business is viable, while the absence of any uncured default ensures that the franchisee has been complying with the terms of the franchise agreement. The requirement to sign a new franchise agreement allows Aerus to update the terms of the agreement to reflect changes in the business environment or the franchise system. The general release protects Aerus from any potential claims by the franchisee.