What is Aira Fitness's policy on using proprietary equipment in the operation of the Aira Fitness Business?

general manager providing the direct full-time on-site supervision of the operation of the Aira Fitness Business.

6. PRODUCTS AND OPERATIONS STANDARDS AND REQUIREMENTS

You must implement and abide by our requirements directed to enhancing substantial System uniformity. The following provisions control with respect to products and operations:

• A. Authorized Equipment; Pod. You must use in the operation of the Aira Fitness Business only the proprietary or non- proprietary equipment that we specify in the Manual (as defined in Section 6.H) or other written directives. You must purchase or lease an initial fitness equipment package ("Initial Fitness Equipment Package") from a supplier approved by us that may include us, our affiliate or a third party. You must purchase or lease all other equipment we designate (including the security and door access system, signage, and software) from a supplier approved by us that may include us, our affiliate, or a third party. If you will be operating your Aira Fitness Business from a Pod, you must purchase or lease the Pod ("Pod Package") from a supplier approved by us that may include us, our affiliate, or a third party. Prior to opening your Aira Fitness Business to the public, you may seek our approval to add additional equipment at your location. We may approve or disapprove your request to add additional equipment in our sole judgment. You will not be allowed to open or operate the Aira Fitness Business with any unapproved equipment. Replacement fitness equipment must be purchased or leased from approved suppliers.
• B. Authorized Products and Services. You may offer and sell only approved products and approved services in the Aira Fitness Business and must offer for sale the complete range of required products and required services as listed in the approved products and approved services lists, as we may amend from time to time. You must maintain in stock an inventory of approved products sufficient to meet customer demand and as set forth in the Manual for operating an Aira Fitness Business. You may not offer, sell or supply any products or services which are not approved products or approved services (including products or services that we have withdrawn), without our prior written consent. You must also conform to all quality and customer service standards we prescribe in writing.
• C. Memberships. You must sell memberships ("Memberships") only on such terms and conditions as we specify periodically. All Memberships must be evidenced by a written or, if approved or required by us, electronic agreement ("Membership Agreement") and all member and billing information must be promptly and accurately

entered into the approved technology system according to our then-current policies.

• a. You must use Membership Agreements that are based on our then-current standard form of Membership Agreement, with the exception, however, that there may be state and local laws that may require you to alter the Membership Agreement in the jurisdictions under which your Aira Fitness Business operates – you must abide by those laws. You are solely and exclusively responsible for ensuring that the Membership Agreements you use in connection with the operation of your Aira Fitness Business comply with all applicable laws and regulations. Any changes to the form document must be approved in writing by us. The Membership Agreement must include: (i) a reciprocity provision that permit members from your Aira Fitness Business to use other facilities and permits another facility's members to also use your Aira Fitness Business, (ii) a waiver and release of us and our affiliates, (iii) requirement for members to pay a yearly maintenance fee in addition to ongoing fees, and (iv) a statement identifying the Aira Fitness Business as an independently-owned franchised location. You must permit members of other facilities to use your Aira Fitness Business under such terms and conditions as we may state in writing from time to time. All Membership Agreements and all billings of any type must be processed through the approved technology system.
• b. We have the right to prohibit or cancel memberships you sell that will expire beyond the expiration date of your Term or any exercised renewal term. You are responsible for all refunds or liabilities to your members due to the cancelation of memberships as provided in this paragraph. You must execute the Membership Contract Assignment Agreement in the form attached at Attachment G.
• c. Minimum Membership Requirement. Beginning on the one-year anniversary of opening for business, you must, at all times, have at least 150 members ("Minimum Membership Requirement"). If, during your second year of operation and thereafter, you do not maintain the Minimum Membership Requirement for 2 consecutive months, we may: (1) require your Principal and General Managers we determine to attend additional training programs; or (2) provide on-site assistance and consultation at your expense. If we provide any additional training, assistance or consultation, you must cover all costs and expenses for such training, assistance or consultation.

Source: Item 23 — **RECEIPTS (FDD pages 59–254)