Does the Aira Fitness Guaranty specify if the Guarantor is responsible for Franchisor's attorney's fees even if there is no lawsuit?
Aira_Fitness Franchise · 2025 FDDAnswer from 2025 FDD Document
ive you the appropriate notice, we will be entitled, without being required to post a bond, to seek the entry of temporary and permanent injunctions
| AIRA FITNESS | | | |---------------------|--------|--------------------| | MUDA 2025 | - 11 - | | | FRANCHISOR INITIALS | | DEVELOPER INITIALS |
and orders of specific performance to: (i) enforce the provisions of this Agreement relating to your use of the Marks and the non-disclosure and non-competition obligations under this Agreement; (ii) prohibit any act or omission by Developer or its Owners that constitutes a violation of any applicable law, ordinance or regulation, constitutes a danger to the public, or may impair the goodwill associated with the Marks or the AIRA FITNESS franchises; (iii) prevent any other irreparable harm to our interests; (iv) enforce your obligations upon termination or expiration of this Agreement; and (v) prohibit an assignment or attempted assignment of any interest in this Agreement or Developer in violation of the applicable provisions of this Agreement. If we obtain an injunction or order of specific performance, you agree to pay us an amount equal to the total of our costs of obtaining it, including, without limitation, reasonable attorneys' fees, expert witness fees, costs of investigation and proof of facts, court costs, other litigation expenses and travel and living expenses, and any damages we incur as a result of the breach of any such provision. You further agree to waive any claims for damages in the event there is a later determination that an injunction or specific performance order was issued improperly.
- 12.3 Arbitration. Except for controversies, disputes or claims related to or based on Developer's use of the Marks or Confidential Information, Developer's compliance with its noncompetition obligations, all controversies, disputes or claims between Franchisor, its affiliates, and their respective owners, officers, directors, agents, employees and attorneys, and Developer (its affiliates and owners and guarantors, if applicable), arising out of or related to this Agreement or any other agreement between the parties; the parties' rights and obligations under this Agreement; Franchisor's relationship with Developer or the obligations by and between the parties;
Source: Item 23 — **RECEIPTS (FDD pages 59–254)
What This Means (2025 FDD)
According to the 2025 Aira Fitness FDD, the guaranty agreement outlines the guarantor's obligations, but it does not explicitly state whether the guarantor is responsible for the franchisor's attorney's fees in the absence of a lawsuit. The guaranty ensures the developer fulfills their obligations under the Franchise Agreement. In the event of a default, the guarantor is responsible for curing the default at their own expense. The agreement also specifies that the guarantor's obligations are independent of the developer's and remain in effect until all obligations are fulfilled.
However, the FDD does mention circumstances where the franchisee may be responsible for attorney's fees. Specifically, if Aira Fitness obtains an injunction or order of specific performance due to the franchisee's actions, the franchisee agrees to cover Aira Fitness's costs, including reasonable attorneys' fees. Additionally, the franchisee agrees to indemnify Aira Fitness, its affiliates, and their shareholders, directors, officers, employees, agents, and transferees, against any liabilities, damages, and costs, including reasonable attorneys' fees, incurred in defending claims or enforcing the Franchise Agreement.
Since the document does not explicitly address responsibility for attorney's fees outside of legal action, it would be prudent for a prospective Aira Fitness franchisee to seek clarification from the franchisor regarding this matter. Understanding the specific conditions under which a guarantor might be responsible for attorney's fees, even without a lawsuit, is crucial for assessing the full scope of the financial obligations and risks associated with the guaranty.