What actions is Aira Fitness authorized to take without notice to the Guarantor?
Aira_Fitness Franchise · 2025 FDDAnswer from 2025 FDD Document
In the event any of the following defaults occurs, you will have no right or opportunity to cure the default and this Agreement will terminate effective immediately on our issuance of written notice of termination: (i) you have failed to identify a mutually acceptable site for the operation of the Aira Fitness Business or to open the Aira Fitness Business for business within the time period provided by this Agreement; (ii) you or any Owner has made any material misrepresentation or omission in your franchise application or any other report to us; (iii) your voluntary abandonment of this Agreement or the Authorized Location, (iv) the loss of your lease, or the failure to timely cure a default under the lease, (v) the loss of your right of possession or failure to reopen or relocate under Section 5.G.; (vi) the closing of the Aira Fitness Business by any state or local authorities for health or public safety reasons; (vii) any unauthorized use of the Confidential Information; (viii) voluntary or involuntary bankruptcy by or against you or any Owner or guarantor, insolvency, making an assignment for the benefit of creditors or any similar voluntary or involuntary arrangement for the disposition of assets for the benefit of creditors; (ix) conviction of you, any Owners, or guarantors of (or pleading no contest to) any felony or misdemeanor that brings or tends to bring any of the Marks into disrepute or impairs or tends to impair your reputation or the goodwill of the Marks or the Aira Fitness Business, (x) you, any Owner, guarantor or an affiliate of any of you are listed by the United States or United Nations as being a terrorist, financier of terrorism or otherwise restricted from doing business in or with the United States; (xi) intentionally underreport membership sales or Gross Sales, falsify financial data, or otherwise commit an act of fraud with respect to your acquisition of this franchise or your rights or obligations under this Agreement, or any understatement or 2% variance on a subsequent audit within a two- year period under Section 10.C., (xii) any unauthorized transfer or assignment in violation of Section 12; (xiii) your failure to use the approved payment processor, (xiv) you failed to meet the Minimum Membership Requirement for six (6) consecutive months, (xv) you failed to meet the Minimum Monthly Gross Sales Requirement for six (6) consecutive months, or *(xv)*any default by you that is the second same or similar default within any 12 month consecutive period or the third default of any type within any 24-month consecutive period.
Source: Item 23 — **RECEIPTS (FDD pages 59–254)
What This Means (2025 FDD)
The 2025 Aira Fitness Franchise Disclosure Document outlines several actions that Aira Fitness can take without providing notice to the guarantor. These actions are triggered by specific events of default by the franchisee.
Specifically, Aira Fitness can immediately terminate the Franchise Agreement without any opportunity for the franchisee to cure the default if certain conditions are met. These conditions include failing to identify a mutually acceptable site or open the business on time, material misrepresentations in the franchise application, voluntary abandonment of the agreement or location, loss of the lease, failure to reopen or relocate as required, closure of the business by authorities for health/safety reasons, unauthorized use of confidential information, bankruptcy or insolvency, conviction of a felony or certain misdemeanors, being listed as a terrorist or financier of terrorism, intentionally underreporting sales or falsifying data, unauthorized transfer of the franchise, failure to use the approved payment processor, or failing to meet minimum membership or gross sales requirements for six consecutive months. Additionally, a second similar default within 12 months or a third default of any type within 24 months also allows for immediate termination.
These stipulations are significant for potential Aira Fitness franchisees and their guarantors. The guarantor should be aware that certain actions or inactions by the franchisee can lead to immediate termination of the agreement, without prior notice or an opportunity to rectify the situation. This could have serious financial implications for both the franchisee and the guarantor, who may be responsible for outstanding obligations even after termination. Franchisees should carefully review these conditions to understand their responsibilities and the potential consequences of non-compliance.