What is the maximum liability of Aerus to the Licensee for damages under the Software License agreement?
Aerus Franchise · 2025 FDDAnswer from 2025 FDD Document
IN THE EVENT THAT ANY OTHER TERM OF THIS SOFTWARE LICENSE IS FOUND OR DETERMINED TO BE UNCONSCIONABLE OR UNENFORCEABLE FOR ANY REASON, THE FOREGOING PROVISION OF WAIVER**
- **BY AGREEMENT OF DIRECT, INDIRECT, SPECIAL, INCIDENTAL, CONSEQUENTIAL OR OTHER DAMAGES OR FOR LOST DATA OR LOST PROFITS WILL CONTINUE IN FULL FORCE AND EFFECT.
WITHOUT LIMITING THE FOREGOING, IN NO EVENT WILL LICENSOR BE LIABLE TO LICENSEE FOR DAMAGES (DIRECT OR OTHERWISE) UNDER THIS AGREEMENT IN EXCESS OF THE INITIAL FRANCHISE FEE PAID BY LICENSEE TO LICENSOR, EVEN IF LICENSOR HAS BEEN NOTIFIED OF THE POSSIBILITY OF SUCH DAMAGES AND NOTWITHSTANDING THE FAILURE OF ESSENTIAL PURPOSE OF ANY LIMITED WARRANTY.
THESE DISCLAIMERS OF WARRANTY AND LIMITATIONS OF LIABILITY CONSTITUTE AN ESSENTIAL PART OF THIS AGREEMENT.**
Source: Item 23 — Receipts (FDD pages 74–305)
What This Means (2025 FDD)
According to Aerus's 2025 Franchise Disclosure Document, the maximum liability of Aerus to the licensee for damages, whether direct or otherwise, under the Software License Agreement is capped at the amount of the initial franchise fee paid by the licensee to Aerus. This limitation applies even if Aerus has been informed of the potential for such damages and regardless of the failure of any limited warranty's essential purpose.
This provision means that a franchisee's potential recovery from Aerus for any software-related issues is limited to the initial franchise fee they paid. This could be a significant limitation if the actual damages incurred by the franchisee due to software malfunctions or errors exceed that initial fee. The FDD also states that the waiver of direct, indirect, special, incidental, consequential, or other damages, or for lost data or lost profits, will remain in full force and effect even if any other term of the software license is found to be unconscionable or unenforceable.
Such limitations of liability are common in franchise agreements. Prospective franchisees should carefully consider this limitation, especially in relation to the potential impact of software issues on their business operations. It is important to assess whether the initial franchise fee adequately covers the potential risks associated with the software's performance and reliability. Franchisees may want to consult with a legal professional to fully understand the implications of this clause and explore options for mitigating potential losses beyond the initial franchise fee.