Who is considered a 'Covered Person' under the non-compete covenants for Aira Fitness?
Aira_Fitness Franchise · 2025 FDDAnswer from 2025 FDD Document
Unless otherwise specified, the term "Covered Person" as used in this Section 10.D includes, collectively and individually, your Owners and all guarantors, officers, directors, members, managers, partners, as the case may be, and holders of any ownership interest in you.
We may require you to obtain from your individuals identified in the preceding sentence a signed non-compete agreement in a form satisfactory to us that contains the non-compete provisions of this Section 11.D.
Source: Item 23 — **RECEIPTS (FDD pages 59–254)
What This Means (2025 FDD)
According to Aira Fitness's 2025 Franchise Disclosure Document, the non-compete covenants apply to 'Covered Persons.' These individuals are bound by certain restrictions during the term of the franchise agreement and potentially after termination. The definition of 'Covered Person' is broad, encompassing not only the franchisee but also other individuals associated with the franchisee's business.
Specifically, a 'Covered Person' includes the Owners of the franchise, as well as all guarantors, officers, directors, members, managers, and partners. It also extends to anyone holding any ownership interest in the franchise. This comprehensive definition ensures that all individuals with significant influence or financial stake in the Aira Fitness franchise are subject to the non-compete obligations.
Aira Fitness retains the right to require franchisees to obtain signed non-compete agreements from these 'Covered Persons.' These agreements must be in a form satisfactory to Aira Fitness and contain the non-compete provisions outlined in the franchise agreement. This provision allows Aira Fitness to directly enforce the non-compete obligations against these individuals, providing an additional layer of protection for the Aira Fitness brand and business model.
For a prospective franchisee, this means that not only will they be bound by the non-compete covenants, but also their business partners, investors, and key personnel. It is crucial for potential franchisees to understand the scope of these restrictions and ensure that all relevant parties are aware of and willing to comply with the non-compete obligations. This may involve legal consultation to fully understand the implications and ensure compliance.