If an Aerus franchisee violates the license granted with respect to the Marks, can Aerus terminate the agreement?
Aerus Franchise · 2025 FDDAnswer from 2025 FDD Document
- C.
Termination, non-renewal or expiration of this Agreement shall not operate as a cancellation of any indebtedness owing to Company or Company's Affiliates by Franchisee at the time of such termination.
Company's failure in any instance to invoke a right to terminate shall not waive or otherwise limit its ability or right to properly terminate this Agreement thereafter.
Termination of this Agreement shall automatically terminate any and all licenses and agreements made by Franchisee with Sales Representatives.
- D.
Without limiting or restricting Company's right to terminate this Agreement at any time as provided herein, Company may implement a system of enforcement of the terms and provisions of this Agreement (including without limitation announced or unannounced compliance audits and "secret shopper" practices), which system may result in deferral of termination under certain circumstances and include any one or more of the following: (1) the imposition of fines or penalties associated with certain violations or breaches; (2) in the case of a royalty, impose a minimum or fixed amount to be paid in place of or in addition to the amount provided in Schedule 3 attached hereto; or (3) in the case of sales of the Products, impose the Minimum Sales Requirement set forth in Schedule 4 attached hereto.
The existence, substance and process of any such system would be the sole and exclusive discretion of Company and may be implemented, revoked or modified (upon reasonable notice to Franchisee) at any time and from time to time.
- 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.
Source: Item 23 — Receipts (FDD pages 74–305)
What This Means (2025 FDD)
According to Aerus's 2025 Franchise Disclosure Document, Aerus retains the right to terminate the franchise agreement if a franchisee violates the terms of the agreement. Aerus may also implement a system of enforcement for violations of the agreement's terms. This system could involve penalties or fines, or setting minimum royalty or sales requirements. Aerus has the sole discretion to implement, change, or revoke this enforcement system.
If the franchise agreement is terminated, any licenses or agreements the Aerus franchisee has with sales representatives are also automatically terminated. The franchisee must immediately stop operating the franchised business and discontinue all use of Aerus's marks, software, and customer data. They must also remove any signs indicating they are an Aerus franchisee and stop all related advertising.
These stipulations are typical in franchise agreements to protect the brand's integrity and ensure consistent operation across all franchise locations. Prospective franchisees should carefully review the conditions under which Aerus can terminate the agreement and understand the potential consequences of such termination.