What is the Aerus debtor's obligation regarding the jurisdiction of formation?
Aerus Franchise · 2025 FDDAnswer from 2025 FDD Document
B. If a business entity:
- (1) Franchisee is duly organized and validly existing under the law of the jurisdiction of its formation and is duly qualified and authorized to do business in each jurisdiction in which the Franchised Business will operate;
- (2) Franchisee's charter documents currently provide and will at all future times provide that Franchisee's activities shall be confined exclusively to the ownership and operation of an Aerus Business, unless Company otherwise consents in writing;
- (3) Franchisee has provided to Company for review certified copies of its articles of organization or other charter documents, any amendments thereto, resolutions of its Board of Directors or Board of Managers, or consent of its limited partners, authorizing and consenting to entry into and performance of this Agreement, and any certificates, buy-sell agreements or other documents restricting the sale or transfer of equity of the entity, and any other documents as Company may reasonably require prior to the execution of this Agreement;
- (4) The individual executing this Agreement is duly authorized to so execute, has appropriate authority to bind Franchisee as provided hereunder, and is an active, full-time participant in the daily operations of the Franchised Business; and
- (5) Franchisee's execution of this Agreement, and entry into the business arrangement contemplated hereby, do not violate any prior existing obligation, any law or any of the contractual or business relationship of Franchisee or any of Franchisee's principals.
Source: Item 23 — Receipts (FDD pages 74–305)
What This Means (2025 FDD)
According to Aerus's 2025 Franchise Disclosure Document, if the franchisee is a business entity, it must be duly organized and validly existing under the laws of the jurisdiction of its formation. Additionally, the franchisee must be qualified and authorized to conduct business in each jurisdiction where the franchised business will operate.
Aerus requires that the franchisee's charter documents stipulate that its activities are confined exclusively to the ownership and operation of an Aerus Business, unless Aerus provides written consent otherwise. The franchisee must provide certified copies of its articles of organization or other charter documents, including any amendments, resolutions from its Board of Directors or Managers, consent of limited partners authorizing entry into the Franchise Agreement, and any documents restricting equity sale or transfer.
Furthermore, the individual executing the Franchise Agreement on behalf of the business entity must be duly authorized to do so and have the appropriate authority to bind the franchisee. This individual must also be an active, full-time participant in the daily operations of the Aerus franchised business. Aerus also requires assurance that the franchisee's execution of the agreement does not violate any prior existing obligations, laws, or contractual or business relationships of the franchisee or its principals.