Is the Franchisor's Affiliate obligated to dispose of the Pod by sale or otherwise if they decide not to take possession of it after an Aira Fitness franchisee's default?
Aira_Fitness Franchise · 2025 FDDAnswer from 2025 FDD Document
- (b) If Franchisor's Affiliate decides, in its sole discretion, not to take possession of the Pod, Franchisor's Affiliate continues to be the owner of the Pod and may, but is not obligated to, dispose of the Pod by sale or otherwise, all of which determinations may be made by Franchisor's Affiliate in its sole discretion and for its own account;
Source: Item 23 — **RECEIPTS (FDD pages 59–254)
What This Means (2025 FDD)
According to Aira Fitness's 2025 Franchise Disclosure Document, if an Aira Fitness franchisee defaults and the Franchisor's Affiliate decides not to take possession of the Pod, the Affiliate is not obligated to dispose of the Pod by sale or otherwise. The document states that the Affiliate "continues to be the owner of the Pod and may, but is not obligated to, dispose of the Pod by sale or otherwise." This determination is at the Affiliate's "sole discretion and for its own account."
This means that after a default, Aira Fitness's Affiliate has the option, but not the requirement, to sell the Pod. They can choose to retain ownership without needing to actively liquidate the asset. This provides flexibility for the Affiliate in managing assets after a franchisee's default.
For a prospective Aira Fitness franchisee, this clause implies that in the event of default, they cannot rely on the Affiliate to sell the Pod to offset any outstanding debts or obligations. The Affiliate's decision to sell or not is entirely at their discretion, potentially leaving the franchisee responsible for remaining financial obligations even without possession of the Pod.