What is the relationship between the good faith deposit mentioned in Item 5 and the financing options potentially available in Item 10 for an Aerus franchise?
Aerus Franchise · 2025 FDDAnswer from 2025 FDD Document
th Deposit and Initial Franchise Fee
We may require that you pay us a good faith deposit of $100, together with delivering to us a commitment letter, a sample of which is attached as Exhibit 7 to this Disclosure Document, before we will send an execution copy of the Franchise Agreement to you. The requirement of the $100 good faith deposit is dependent upon information disclosed to us in your application, such as work history, credit worthiness, previous franchise experience, references and/or previous work history with us or other Aerus franchisees. If we require the good faith deposit, it will be applied to the initial franchise fee and is only refundable if we choose not to enter into the Franchise Agreement with you. You must pay us the following non-refundable initial franchise fee at the time you sign
a Franchise Agreement, which will vary depending on the type of Franchised Business you wish to operate:
| Program | Initial Franchise Fee (less the amount of any good faith deposit paid) | |---|---| | Standard Program | $3,000 | | Associate Program | $1,000 | | Beyond Addendum (Standard Program) | $100 | | Beyond Addendum (Associate Program) | $100 | | Inventory (Standard Program) | $15,000 to $90,000 | | Inventory (Associate Program) | $5,000 to $20,000 | | Goodwill (Standard Program) | 0 to $200,000 | | Goodwill (Associate Program) | 0 to $25,000 | | Furniture, Fixtures, and Equipment (Standard | $2,500 to $15,000 | | Program) | | | Furniture, Fixtures, and Equipment (Associate | $2,000 to $5,000 | | Program) | | We can require you to purchase required furniture, fixtures, and equipment (including the computer system) from us, our affiliate, or designated suppliers.
As an incentive to recruit new franchisees into the business, we may waive or discount the initial franchise fee.
What This Means (2025 FDD)
According to Aerus's 2025 Franchise Disclosure Document, the good faith deposit of $100 may be required before Aerus sends an execution copy of the Franchise Agreement. This requirement depends on information disclosed in the franchisee's application, such as work history, creditworthiness, previous franchise experience, references, or previous work history with Aerus. If required, the $100 good faith deposit will be applied to the initial franchise fee.
Item 10 states that Aerus is not obligated to offer financing to any franchisee. However, Aerus or its affiliates may offer financing for initial fees, security deposits, accessories, parts and supplies purchased from them, and the purchase of assets of an existing Aerus business. The amount financed and the terms of the financing will vary based on factors such as the performance of the Aerus business, goodwill associated with the location, and the franchisee's creditworthiness.
The initial down payment for financing may range from approximately $2,500 to $50,000, with the balance paid in equal monthly installments. The debt may be prepaid without penalty. If a franchisee defaults on their payment obligations, Aerus may terminate the Franchise Agreement. If any amount is financed, the franchisee must sign a secured promissory note, which may require a limited personal guaranty and a perfected security interest in the assets purchased.
In summary, the $100 good faith deposit, if required, is credited towards the initial franchise fee. Separate from this, Aerus may offer financing for the initial franchise fee and other costs, but this is not guaranteed and depends on various factors, including the franchisee's creditworthiness and the performance of the Aerus business. The good faith deposit is a preliminary step, while financing is a separate potential arrangement for covering larger initial investment costs.