What is the Aerus debtor prohibited from permitting regarding the collateral and taxes?

According to Aerus's 2025 Franchise Disclosure Document, the Debtor (franchisee) is obligated to pay all taxes, assessments, and charges imposed on them or any of the collateral when due. The Debtor is prohibited from permitting waste of the collateral. This means the franchisee must ensure that all tax obligations related to the business and its assets are met promptly. Additionally, the franchisee must actively prevent any actions or neglect that could diminish the value or condition of the collateral.

This requirement protects Aerus's security interest in the collateral, ensuring that the assets retain their value and are not subject to tax-related claims or deterioration. For a prospective franchisee, this signifies a responsibility to manage the business and its assets diligently, maintaining them in good condition and staying current with all tax obligations. Failure to do so could lead to an event of default under the security agreement.

This is a standard practice in franchising, where franchisors often take a security interest in the franchisee's assets to protect their investment and ensure compliance with the franchise agreement. Franchisees should carefully review the security agreement and understand their obligations regarding the collateral and taxes to avoid any potential issues during the franchise term.