For Aira Fitness, what is the duration of the post-termination covenant not to compete?
Aira_Fitness Franchise · 2025 FDDAnswer from 2025 FDD Document
For a period of two years after the transfer, expiration or termination of this Agreement (and with respect to any Owner, for a period of two years after such person ceases to be an Owner, regardless of the reason), Covered Persons must not directly or indirectly, for themselves or through, on behalf of or in conjunction with any individual or business entity: (i) divert any Aira Fitness Business member, potential Aira Fitness Business member or former Aira Fitness Business member to any exercise facility except another Aira Fitness Business; or (ii) own, operate, lease, franchise, engage in, be connected with, have any interest in, or assist any person or entity engaged in any other exercise facility (including, but not limited to a 24/7 fitness center, studio or exercise facility; a fitness center, studio or exercise facility featuring keycard access or a structured fitness/training program or complete body overhaul program for individuals) that is located at or within a 10-mile radius of the Authorized Location, that is located within a 10-mile radius of any other Aira Fitness Business in operation or under construction, or that is located in the Designated Area of any other AIRA FITNESS franchisee.
The two-year period described in this paragraph will be tolled during any period of noncompliance.
Source: Item 23 — **RECEIPTS (FDD pages 59–254)
What This Means (2025 FDD)
According to the 2025 Aira Fitness Franchise Disclosure Document, the post-termination covenant not to compete lasts for two years. Specifically, for a period of two years after the transfer, expiration, or termination of the Franchise Agreement, the franchisee and their owners are restricted from engaging in or being involved with any other exercise facility. This restriction applies regardless of the reason for termination or transfer.
The non-compete clause prevents former Aira Fitness franchisees from diverting members, potential members, or former members to another exercise facility, except for another Aira Fitness location. It also restricts them from owning, operating, leasing, franchising, or having any interest in another exercise facility within a 10-mile radius of the authorized Aira Fitness location, any other Aira Fitness location in operation or under construction, or within the designated area of another Aira Fitness franchisee.
This two-year period can be extended if the franchisee is in noncompliance with the agreement, as the period is tolled during any period of noncompliance. Aira Fitness emphasizes that these restrictions are reasonable and necessary to protect the company and its system, including other franchisees. The company also states that these prohibitions are broad to prevent franchisees from using the information, materials, and training provided to compete with Aira Fitness or restrict their ability to enter new markets.
Prospective franchisees should carefully consider the implications of this non-compete agreement, as it significantly restricts their ability to operate a similar business after leaving the Aira Fitness system. It is advisable to seek legal counsel to fully understand the scope and enforceability of these restrictions in their specific jurisdiction.