What interest rate applies to unpaid rent after an Aira Fitness franchisee's Event of Default?
Aira_Fitness Franchise · 2025 FDDAnswer from 2025 FDD Document
- (b) The Equipment is and shall at all times be and remain the sole and exclusive personal property of Franchisor's Affiliate, and notwithstanding any trade-in or down payment by Franchisee or on its behalf with respect to the Equipment, Franchisee shall have no right, title or interest therein or thereto except as to the use thereof subject to the terms or conditions of this Lease.
- 3. Term and Rent; Purchase Option. Franchisee shall pay as monthly rent for use of the Equipment the amount described in Paragraph 1(h) above on the 1st day of each month following the Commencement Date. If any rental shall be unpaid for more than five (5) days after the
Source: Item 23 — **RECEIPTS (FDD pages 59–254)
What This Means (2025 FDD)
According to the 2025 Aira Fitness Franchise Disclosure Document, if a franchisee fails to pay their monthly equipment rent within five days of the due date, they will incur an additional charge. This charge is structured as a late service or overhead fee, not as interest.
The fee will be the greater of $100 or 18% of the unpaid amount. However, the document specifies that this charge will not exceed the maximum lawful charges applicable in the relevant jurisdiction. This clause ensures compliance with any state or local laws that may cap late fees or interest rates.
This policy applies specifically to equipment rent as outlined in the Fitness Equipment Lease Agreement. It is important for prospective Aira Fitness franchisees to understand these terms, as late payments can lead to significant additional costs. Franchisees should also be aware of the potential for varying maximum lawful charges depending on their location.