Does a management agreement constitute a transfer of the Aira Fitness franchise?
Aira_Fitness Franchise · 2025 FDDAnswer from 2025 FDD Document
Any sale (including installment sale), lease, pledge, management agreement, contract for deed, option agreement, assignment, bequest, gift or otherwise, or any arrangement pursuant to which you turn over all or part of the daily operation of the business to a person or entity who shares in the losses or profits of the business in a manner other than as an employee will be considered a transfer for purposes of this Agreement. Specifically, but without limiting the generality of the foregoing, the following events constitute a transfer and you must comply with the right of first refusal, consent, transfer fee, and other transfer conditions in this Section 12:
Source: Item 23 — **RECEIPTS (FDD pages 59–254)
What This Means (2025 FDD)
According to Aira Fitness's 2025 Franchise Disclosure Document, a management agreement is considered a transfer of the franchise. Specifically, any arrangement where the franchisee turns over all or part of the daily operation of the business to another party who shares in the profits or losses (other than as an employee) is considered a transfer. This means that if an Aira Fitness franchisee enters into a management agreement, they must comply with the transfer conditions outlined in Section 12 of the franchise agreement.
These transfer conditions include offering Aira Fitness the right of first refusal to acquire the agreement. If Aira Fitness declines, the franchisee must obtain the franchisor's written consent and pay a transfer fee. If the transferee is an existing Aira Fitness franchisee, the transfer fee is $5,000; if not, the fee is equal to the then-current initial franchise fee.
Furthermore, the transferee may need to meet certain training requirements as specified in Section 7.B of the Aira Fitness franchise agreement. Aira Fitness also has the right to request financial reports and data related to the business to evaluate the proposed transfer. If the transfer results in a change of control, the transferee must execute Aira Fitness's current form of franchise agreement and personal guaranty. These stipulations ensure that Aira Fitness maintains control over who operates its franchises and that the new operator meets their standards.