Is the Guaranty for the benefit of any third party besides Aira Fitness Franchising LLC?
Aira_Fitness Franchise · 2025 FDDAnswer from 2025 FDD Document
| THIS GUARANTY AND ASSUMPTION OF DEVELOPER'S OBLIGATIONS ("Guaranty") is made as of, 20, in consideration of, and as an inducement to, the execution of the Franchise Agreement by Aira Fitness Franchising LLC, an Illinois limited liability company ("Franchisor"). In consideration thereof, each of the undersigned hereby jointly and severally, personally and unconditionally agrees as follows: |
|---|
| 1. |
| Guaranty. |
| Guarantor(s) hereby unconditionally and absolutely warrants and |
| guarantees to Franchisor that ("Developer") shall punctually pay and perform in full |
| each and every undertaking, agreement and covenant set forth in the Franchise Agreement; |
| 2. |
| Obligations of Guarantor Upon Event of Default. Should a Default (as defined in |
| the Franchise Agreement) occur, Guarantor(s) shall diligently proceed to cure such Default at |
| Guarantor's sole cost and expense; |
| 3. |
| Nature of Guaranty. |
| This Guaranty is an original and independent obligation of |
| Guarantor(s), separate and distinct from Developer's obligations to Franchisor under the Multi-Unit |
| Development |
| Agreement. The obligations of Guarantor to Franchisor under this Guaranty are direct |
| and primary, regardless of the validity or enforceability of the Franchise Agreement. This Guaranty is |
| for the benefit of Franchisor and is not for the benefit of any third party. This Guaranty shall continue |
| until all obligations of Guarantor to Franchisor under this Guaranty have been performed in full. |
Source: Item 23 — **RECEIPTS (FDD pages 59–254)
What This Means (2025 FDD)
According to Aira Fitness's 2025 Franchise Disclosure Document, the Guaranty provided by the franchisee's owners is specifically for the benefit of Aira Fitness Franchising LLC, the franchisor. The document explicitly states that the Guaranty is not intended to benefit any third party. This means that only Aira Fitness can directly enforce the terms of the Guaranty against the guarantor.
This provision is important for prospective Aira Fitness franchisees because it clarifies the scope and beneficiaries of the Guaranty. Typically, a personal guarantee ensures that the franchisor has recourse to the personal assets of the franchisee's owners if the franchise fails to meet its financial or contractual obligations. The fact that it is not for the benefit of any third party reinforces that Aira Fitness is the sole entity that can make a claim under the Guaranty.
This arrangement is fairly standard in the franchise industry, as personal guarantees are primarily designed to protect the franchisor's interests. Franchisees should be aware of this and understand that their personal assets are at risk should their Aira Fitness franchise default on its obligations to the franchisor.