What tangible assets of the Franchised Business can Aerus purchase from the franchisee upon termination?
Aerus Franchise · 2025 FDDAnswer from 2025 FDD Document
- F. Upon expiration or termination of this Agreement, Franchisee shall do any one or more of the following, at Company's option:
- (1) If Franchisee operates the Franchised Business premises under a lease with a third party or, with respect to any lease for equipment used in the operation of the Franchised Business, assign to Company any interest which Franchisee has in any lease or sublease for the Approved Location or any equipment related to the Franchised Business.
- (2) If Franchisee, or any Affiliate of Franchisee, owns the Approved Location, sell or lease at market rents to Company the Franchisee's business premises including any building thereon, if applicable, for the fair market value of the land and building.
Source: Item 23 — Receipts (FDD pages 74–305)
What This Means (2025 FDD)
According to Aerus's 2025 Franchise Disclosure Document, upon the expiration or termination of the franchise agreement, Aerus has options regarding the physical location and assets of the Franchised Business. If the franchisee operates the business from a leased location, Aerus can choose to have the franchisee assign any interest in the lease or sublease for the Approved Location or any equipment related to the business to Aerus.
Furthermore, if the franchisee or an affiliate owns the Approved Location, Aerus has the option to purchase or lease the business premises. This includes any buildings on the property, if applicable. The purchase price would be the fair market value of the land and building, and the lease would be at market rents.
This clause ensures that Aerus has the opportunity to maintain a presence in the location where the franchise operated, which can be beneficial for business continuity and brand recognition. For a franchisee, this means that upon termination, they may be required to relinquish control of their business location, either through assignment of a lease, sale, or lease to Aerus. It is important for prospective franchisees to understand these potential obligations and consider them in their long-term business planning.