What is the timeframe after notice of permanent disability of an Aerus franchisee or principal within which the interest may be required to be transferred?
Aerus Franchise · 2025 FDDAnswer from 2025 FDD Document
- D. Upon the permanent disability of Franchisee (if a natural person) or any principal of Franchisee, Company may, at Company's sole option, require the interest of such individual to be transferred to a third party in accordance with the conditions described in this Addendum within six (6) months after notice to Franchisee. Permanent disability will be determined by a licensed practicing physician Company selects, upon examination of the person; or if the person refuses to submit to an examination, then such person automatically will be deemed permanently disabled as of the date of such refusal for the purpose of this Addendum.
Source: Item 23 — Receipts (FDD pages 74–305)
What This Means (2025 FDD)
According to Aerus's 2025 Franchise Disclosure Document, if a franchisee or a principal of the franchisee experiences permanent disability, Aerus has the option to require the transfer of the individual's interest to a third party. This transfer must occur within six months after Aerus provides notice to the franchisee.
The FDD specifies how permanent disability is determined. Aerus will select a licensed physician to examine the individual in question. If the person refuses to undergo the examination, they will automatically be deemed permanently disabled from the date of refusal for the purposes of the franchise agreement.
This clause protects Aerus by ensuring that the business can continue to operate effectively even if the franchisee or a key principal becomes unable to manage it due to a disability. For a prospective franchisee, this means understanding that a plan for business continuity is essential in case of disability. It also highlights the importance of having key-person insurance or a partnership agreement that addresses such situations.