What covenants and restrictions must an Aerus franchisee continue to comply with upon termination?
Aerus Franchise · 2025 FDDAnswer from 2025 FDD Document
- E.
Upon expiration or termination of this Agreement, Franchisee and Franchisee's principals shall:
- (1) Immediately cease operation of the Franchised Business and any use of the Marks, Software and Administration Systems or the Customer Data for any reason or purpose; promptly remove all signs, markings, or other writings and, immediately discontinue all advertising or publicity, that tend to indicate that Franchisee is a franchisee of Company or seller of Products; and immediately discontinue all advertising or publicity and take all actions necessary to comply
with the foregoing, including instructing all publishers of any telephone directory or listing not to renew, repeat or insert any listing or advertisement using the word "Aerus", "Lux" or "Electrolux" or any other term or identifier associating Franchisee with Company.
- (2) Send written notice to all Sales Representatives with whom Franchisee has been dealing that any license granted to or agreement made with such is terminated, and that such Sales Representatives must also take all other steps herein required of Franchisee under this Section.
- (3) Cooperate with Company in perfecting an assignment of all telephone numbers used at the Approved Location in connection with the sales of Products hereunder or otherwise known or identified as numbers associated with Company, the Products or the Marks to and into the name of Company or its nominee, taking all action necessary to effect the intent of the foregoing.
- (4) Immediately cause the cancellation or termination of any assumed name filings for the Approved Name or otherwise including the name "Aerus", "Lux" or "Electrolux" or any of the Marks.
- (5) Immediately return to Company and Company's Affiliates all items of personal property that are then owned by Company or Company's Affiliates, including Consigned Products and any equipment and supplies to which Company or Company's Affiliates hold title.
- (6) Promptly pay all sums owing to Company, Company's Affiliates, lessors and other trade creditors.
- (7) Immediately deliver to Company all information (including Customer Data in physical or electronic formats) and databases described herein, and all other Confidential Information (including the Manuals) and all agreements, invoices, and any and all other materials relating to the operation of the Franchised Business in Franchisee's possession or control (including any such information or materials in the possession of any Sales Representative), and all copies thereof.
- (8) Comply with the non-competition covenants and the restrictions on Confidential Information contained herein.
- F. Upon expiration or termination of this Agreement, Franchisee shall do any one or more of the following, at Company's option:
- (1) If Franchisee operates the Franchised Business premises under a lease with a third party or, with respect to any lease for equipment used in the operation of the Franchised Business, assign to Company any interest which Franchisee has in any lease or sublease for the Approved Location or any equipment related to the Franchised Business.
- (2) If Franchisee, or any Affiliate of Franchisee, owns the Approved Location, sell or lease at market rents to Company the Franchisee's business premises including any building thereon, if applicable, for the fair market value of the land and building.
Source: Item 23 — Receipts (FDD pages 74–305)
What This Means (2025 FDD)
According to Aerus's 2025 Franchise Disclosure Document, upon expiration or termination of the Franchise Agreement, the franchisee must adhere to several covenants and restrictions. These include ceasing operation of the Franchised Business and any use of the Marks, Software and Administration Systems or the Customer Data for any reason or purpose. The franchisee must also promptly remove all signs, markings, or other writings and, immediately discontinue all advertising or publicity, that tend to indicate that Franchisee is a franchisee of Company or seller of Products; and immediately discontinue all advertising or publicity and take all actions necessary to comply with the foregoing, including instructing all publishers of any telephone directory or listing not to renew, repeat or insert any listing or advertisement using the word "Aerus", "Lux" or "Electrolux" or any other term or identifier associating Franchisee with Company.
Additionally, the franchisee must send written notice to all Sales Representatives that any license granted to or agreement made with such is terminated, and that such Sales Representatives must also take all other steps herein required of Franchisee under this Section. The franchisee must cooperate with Aerus in perfecting an assignment of all telephone numbers used at the Approved Location in connection with the sales of Products hereunder or otherwise known or identified as numbers associated with Company, the Products or the Marks to and into the name of Company or its nominee, taking all action necessary to effect the intent of the foregoing. They must also immediately cause the cancellation or termination of any assumed name filings for the Approved Name or otherwise including the name "Aerus", "Lux" or "Electrolux" or any of the Marks.
Furthermore, the franchisee is obligated to return to Aerus and Aerus's Affiliates all items of personal property that are then owned by Company or Company's Affiliates, including Consigned Products and any equipment and supplies to which Company or Company's Affiliates hold title. They must promptly pay all sums owing to Company, Company's Affiliates, lessors and other trade creditors. The franchisee must immediately deliver to Aerus all information (including Customer Data in physical or electronic formats) and databases described herein, and all other Confidential Information (including the Manuals) and all agreements, invoices, and any and all other materials relating to the operation of the Franchised Business in Franchisee's possession or control (including any such information or materials in the possession of any Sales Representative), and all copies thereof. Finally, the franchisee must comply with the non-competition covenants and the restrictions on Confidential Information contained herein.
At Aerus's option, the franchisee may be required to assign any interest in leases for the Approved Location or equipment to Aerus, or if the franchisee owns the Approved Location, sell or lease the premises to Aerus at market rates. These post-termination obligations are typical in franchising to protect the brand and confidential information, and to ensure a smooth transition.