Following termination or expiration of the Aira Fitness MUDA, what are the non-competition covenants for the franchisee?
Aira_Fitness Franchise · 2025 FDDAnswer from 2025 FDD Document
- 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."
Source: Item 17 — **RENEWAL, TERMINATION,TRANSFER AND DISPUTE RESOLUTION THE FRANCHISE RELATIONSHIP (FDD pages 48–54)
What This Means (2025 FDD)
According to the 2025 Aira Fitness FDD, the enforceability of non-compete covenants after the termination of a Multi-Unit Development Agreement (MUDA) depends on the state in which the franchise operates. Specifically, for Aira Fitness franchises operating in North Dakota, the FDD includes an addendum stating that covenants not to compete are generally unenforceable. This means that Aira Fitness franchisees in North Dakota may not be legally bound by non-compete clauses included in their Multi-Unit Development Agreement after termination.
This addendum modifies Section 9 of the Multi-Unit Development Agreement, which addresses "Post-Termination Covenants." The modification indicates that non-compete agreements, as described in that section, are typically not enforceable within North Dakota.
For prospective Aira Fitness franchisees, this information is crucial for understanding their rights and obligations upon termination or expiration of their MUDA. If operating in North Dakota, they may have more freedom to engage in competitive activities after the agreement ends compared to franchisees in other states where non-compete clauses are enforceable. Franchisees should consult with legal counsel to fully understand the implications of these clauses in their specific state and situation.