Does the termination of an Aerus franchise agreement cancel any indebtedness owed to the company?
Aerus Franchise · 2025 FDDAnswer from 2025 FDD Document
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.
Source: Item 23 — Receipts (FDD pages 74–305)
What This Means (2025 FDD)
According to Aerus's 2025 Franchise Disclosure Document, the termination, non-renewal, or expiration of the Franchise Agreement does not cancel any debts the franchisee owes to Aerus or its affiliates at the time of termination. This means that even after the franchise agreement ends, the franchisee is still responsible for paying off any outstanding financial obligations.
This provision protects Aerus by ensuring they can still collect outstanding debts even after a franchise relationship ends, whether through termination, non-renewal, or expiration of the agreement. For a prospective franchisee, this means understanding that any financial obligations incurred during the franchise term will remain even if the franchise is terminated.
It is common practice in franchising for franchisees to remain responsible for outstanding debts even after termination. Franchise agreements typically include clauses that address financial obligations upon termination to protect the franchisor's financial interests. Therefore, prospective Aerus franchisees should carefully manage their finances and ensure they can meet their financial obligations to avoid accumulating debt that will persist beyond the term of the franchise agreement.