factual

Where will arbitration take place for Aira Fitness franchise disputes in North Dakota?

Aira_Fitness Franchise · 2025 FDD

Answer from 2025 FDD Document

the original language that appears therein:

"Covenants not to compete such as those mentioned above are generally unenforceable in the State of North Dakota."

    1. Section 13.A. of the Franchise Agreement on "Arbitration; Mediation" is revised as follows:
    • "Arbitration shall take place in the Chicago metropolitan area at a location agreeable to all parties."
    1. Section 13.C. of the Franchise Agreement on "Governing Law/Consent to Jurisdiction" is deleted in its entirety.
    1. Section 13.E. of the Franchise Agreement on "Waiver of Jury Trial" is deleted in its entirety.
    1. Section 13F. of the Franchise Agreement on "Waiver of Punitive Damages" is deleted in its entirety.
    1. Section 14.E. of the Franchise Agreement on "Liquidated Damages" is deleted in its entirety.
    1. No statement, questionnaire, or acknowledgement signed or agreed to by a franchisee in connection with the commencement of the franchise relationship shall have the effect of: (i) waiving any claims under any applicable state franchise law, including fraud in the inducement, or (ii) disclaiming reliance on behalf of the Franchisor. This provision supersedes any other term of any document executed in connection with the franchise.
    1. The North Dakota Securities Department requires the Franchisor or affiliates to defer all initial franchise fees until such time as the Franchisor or affiliates have completed all initial obligations owed to the Franchisee under the Franchise Agreement and the Franchisee has commenced doing business. This deferral of the initial franchise fee is required based on the Franchisor's financial condition.

IN WITNESS WHEREOF, the parties hereto, intending to be legally bound hereby, have duly executed, sealed and delivered this Agreement in duplicate the day and year first above written.

| AIRA FITNESS FRANCHISING, LLC, an Illinois limited liability | FRANCHISEE: | |--------------------------------------------------------------|-------------------------------------| | company | [Insert individual name or company] | | Ву: | By: | | Its: | Its: | | Date: | Date: |

AIRA FITNESS FRANCHISING, LLC ADDENDUM TO THE MULTI-UNIT DEVELOPMENT AGREEMENT FOR THE STATE OF NORTH DAKOTA

This Addendum is to a Multi-Unit Development Agreement dated by and between Aira Fitness Franchising, LLC and (Developer) to amend said Agreement as follows:

  1. Section 8 of the Multi-Unit Development Agreement on "Transferability; Entity as Developer" is amended by the addition of the following language to the original language that appears therein:

"The execution of a general release upon renewal, assignment or termination shall be inapplicable to franchises operating under the North Dakota Franchise Investment Law."

  1. Section 9 of the Multi-Unit Development Agreement on "Post-Termination Covenants" is amended by the addition of the following language to the original language that appears therein:

"Covenants not to compete such as those mentioned above are generally unenforceable in the State of North Dakota."

    1. Section 12.3 of the Multi-Unit Development Agreement on "Arbitration; Mediation" is revised as follows:
    • "Arbitration shall take place in McHenry County, Illinois at a location agreeable to all parties."
    1. Section 12.6 of the Multi-Unit Development Agreement on "Governing Law/Consent to Jurisdiction" is deleted in its entirety.

Source: Item 17 — **RENEWAL, TERMINATION,TRANSFER AND DISPUTE RESOLUTION THE FRANCHISE RELATIONSHIP (FDD pages 48–54)

What This Means (2025 FDD)

According to Aira Fitness's 2025 Franchise Disclosure Document, if a franchisee in North Dakota has a dispute with Aira Fitness that goes to arbitration, the location depends on whether it is a single-unit or multi-unit agreement. For a standard franchise agreement, arbitration will take place in the Chicago metropolitan area at a location agreeable to all parties.

However, if the franchisee has entered into a Multi-Unit Development Agreement with Aira Fitness, the arbitration will instead take place in McHenry County, Illinois, at a location agreeable to all parties. This distinction is important for prospective franchisees in North Dakota to understand, as the location of arbitration could significantly impact the cost and convenience of resolving any potential disputes.

It is fairly typical in franchising to have an arbitration clause, as it is generally faster and less expensive than litigation. Franchise agreements often specify a particular location for arbitration, which may or may not be the franchisee's home state. Franchisees should consider the potential travel costs and logistical challenges when agreeing to an arbitration location that is not close to their business or residence.

Disclaimer: This information is extracted from the 2025 Franchise Disclosure Document and is provided for research purposes only. It does not constitute legal or financial advice. Consult with a franchise attorney before making any investment decisions.