Is Basecamp Fitness allowed to transfer its rights and obligations under the Franchise Agreement?
Basecamp_Fitness Franchise · 2025 FDDAnswer from 2025 FDD Document
| Section in | |||
|---|---|---|---|
| Franchise or Other | |||
| Provision | Agreements | Summary | |
| i. | Your obligations on termination/non-renewal | Section 16 – Franchise Agreement Section 6 – Area Development Agreement | Stop operating the Basecamp Studio, stop using our names and marks, return information to us, assign to us or cancel certain registrations, listings, telephone numbers, websites and domain names, and pay all amounts you owe us, comply with your obligations if we exercise our purchase option. You lose all remaining rights to develop Basecamp Studios. |
| j. | Assignment of contract by us | Section 13.A – Franchise Agreement and Section 7.A – Area Development Agreement | No restriction on our right to assign. |
| k. "Transfer" by you – defined | Section 13.B – Franchise Agreement and Section 7.C – Area Development Agreement | Includes transfer of contract or business, or transfer of majority control of the Franchise Agreement or of the business. | |
| l. | Our approval of transfer by franchisee | Section 13.B – Franchise Agreement Section 7.C – Area Development Agreement | We have the right to approve all transfers, but will not withhold our consent if all of the requirements for the transfer are met. We have the right to approve, but you may not transfer only a portion of your rights. |
| m. Conditions for our approval of transfer | Section 13.B – Franchise Agreement Section 7.C – Area Development Agreement | Conditions include: (i) You must be in compliance with the Franchise Agreement and provide us with all information we require regarding the proposed transaction; (ii) transferee must meet our requirements and sign a new franchise agreement on our then-current form for the remaining term of your agreement (which may contain materially different terms and conditions then in your agreement, but we will not require the transferee to pay us a new initial franchise fee.); (iii) payment of any broker fees or commissions and you must also pay a transfer fee and sign a release (subject to state law); (iv) transferee must agree to perform any maintenance, remodeling and re-equipping of your Basecamp Studio that we deem necessary; and (v) transferee's Principal Operator must successfully complete all required training. You must meet any additional conditions we specify in the Operations Manual or otherwise in writing |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER, AND DISPUTE RESOLUTION (FDD pages 51–55)
What This Means (2025 FDD)
According to Basecamp Fitness's 2025 Franchise Disclosure Document, Basecamp Fitness has the right to assign the Franchise Agreement. Specifically, there is "[n]o restriction on our right to assign" the contract. This means that Basecamp Fitness, as the franchisor, can transfer its rights and obligations under the Franchise Agreement to another party without needing the franchisee's consent.
This is a standard clause in most franchise agreements, allowing the franchisor flexibility in structuring their business. For a potential Basecamp Fitness franchisee, this means that the company they initially contract with might not be the same entity throughout the term of the agreement. The new entity would then assume the responsibilities of the franchisor.
While Basecamp Fitness can transfer the agreement, the franchisee's ability to transfer is subject to certain conditions. The franchisee must be in compliance with the Franchise Agreement, provide all required information, and the transferee must meet Basecamp Fitness's requirements, sign a new franchise agreement, pay any broker fees or commissions, and pay a transfer fee. The transferee must also agree to perform any necessary maintenance, remodeling, and re-equipping of the Basecamp Studio, and the transferee's Principal Operator must successfully complete all required training. These conditions ensure that any new franchisee meets Basecamp Fitness's standards and is capable of operating the franchise successfully.