If a franchisee fails to pay amounts due to Aira Fitness, does Aira Fitness have the right to deduct these amounts from any monies held for the franchisee's account?
Aira_Fitness Franchise · 2025 FDDAnswer from 2025 FDD Document
As a duly authorized signer on the Merchant Account, I authorize Aira Fitness Franchising, LLC ("Company") to initiate monthly Merchant Account debits for payments due or when applicable, apply Merchant Account credits to the same. Said debits may be for Royalty Fees, National Marketing Fund contributions, website fees, yearly maintenance fees, interest, late fees, and any other amounts Franchisee owes to the Company or its affiliates pursuant to the Franchise Agreement between Franchisee and Company, and in amounts required by the Franchise Agreement. The dollar amount to be debited for each debit will vary.
Currently, Company is initiating monthly debits on the first day of every calendar week for payment of the Royalty Fees, National Marketing Fund contributions, website fees, yearly maintenance fees, interest, late fees, and any other amounts then due, unless that day falls on a holiday, in which case the debit will be initiated the following business day. The dates and intervals for initiating debits for amounts due under the Franchise Agreement may be changed upon delivery of notice to Franchisee.
If, at the time of any debit, the Merchant Account does not contain sufficient credit for all amounts then due (Non-Sufficient or Uncollected Funds), I understand that Company shall be entitled to collect interest and late fees as provided in the Franchise Agreement, and to debit same from the Merchant Account once there are sufficient funds to cover it.
Franchisee is responsible for, and shall pay on demand, all costs or fee charged by the Approved Payment Processor holding the account relating to the handling of debits pursuant to this authorization. I understand and authorize all of the above.
Source: Item 23 — **RECEIPTS (FDD pages 59–254)
What This Means (2025 FDD)
According to Aira Fitness's 2025 Franchise Disclosure Document, Aira Fitness has the authorization to deduct payments from a franchisee's merchant account for various fees and debts. Specifically, Aira Fitness is authorized to initiate monthly debits from the franchisee's Merchant Account for payments due. These payments can include royalty fees, national marketing fund contributions, website fees, yearly maintenance fees, interest, late fees, and any other amounts the franchisee owes to Aira Fitness or its affiliates under the Franchise Agreement. The exact dollar amount of these debits can vary.
The FDD states that Aira Fitness typically initiates these monthly debits on the first day of every calendar week, unless that day falls on a holiday, in which case the debit is initiated the following business day. However, Aira Fitness can change the dates and intervals for initiating debits by providing notice to the franchisee.
Furthermore, if the franchisee's Merchant Account does not have sufficient funds to cover all amounts due at the time of the debit, Aira Fitness is entitled to collect interest and late fees as outlined in the Franchise Agreement. They can then debit these fees from the Merchant Account once sufficient funds are available. The franchisee is responsible for paying all costs or fees charged by the Approved Payment Processor related to these debits.