What happens to the Pod if the Franchisor's Affiliate decides not to take possession after an Aira Fitness franchisee's Event of 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 Event of Default occurs and Franchisor's Affiliate decides not to take possession of the Pod, the Affiliate still retains ownership of the Pod. The Affiliate then has the option, but not the obligation, to dispose of the Pod through sale or other means. The decision to dispose of the Pod and the method of disposal are at the sole discretion of Franchisor's Affiliate, and any proceeds from the disposal belong to the Affiliate.
This means that even if Aira Fitness franchisees default on their lease agreement, they do not automatically regain control or ownership of the Pod. The Franchisor's Affiliate maintains the right to decide the Pod's fate, whether that involves selling it, re-leasing it, or otherwise disposing of it. The franchisee has no say in this decision and will not receive any financial benefit from the disposal.
This clause protects the Franchisor's Affiliate's investment in the Pod and allows them to recover some of their losses in the event of a franchisee default. However, it also places the risk of potential loss on the franchisee, who may still be liable for outstanding lease payments even after losing possession of the Pod. Prospective Aira Fitness franchisees should carefully consider this clause and understand the potential financial implications of defaulting on their lease agreement.
It is important for prospective franchisees to seek legal counsel to fully understand their rights and obligations under the lease agreement and to assess the potential risks associated with leasing the Pod from Franchisor's Affiliate.