What happens to the Basecamp Fitness customer's security deposit if they default?
Basecamp_Fitness Franchise · 2025 FDDAnswer from 2025 FDD Document
If Customer is ever in default, Owner may do any of the following, each of which shall be cumulative: retain Customer's security deposit;
The Security Deposit is to secure Customer's performance under this Agreement. Is usomer will pay the security deposit on the date Customer signs this Agreement. In the event this Agreement is not fully completed or consummated, the security deposit will be retained by Owner to compensate Owner for Owner's documentation, processing, collection efforts and other expenses.
Source: Item 23 — RECEIPTS (FDD pages 62–248)
What This Means (2025 FDD)
According to Basecamp Fitness's 2025 Franchise Disclosure Document, if a customer defaults on their agreement, the owner has the right to retain the customer's security deposit. The security deposit is intended to secure the customer's performance under the agreement. The customer will pay the security deposit on the date the customer signs the agreement.
Furthermore, if the agreement is not fully completed or consummated, the owner will retain the security deposit to compensate for documentation, processing, collection efforts, and other expenses. This means that even if the customer doesn't fully go through with the agreement, Basecamp Fitness can keep the deposit to cover costs incurred.
This policy is fairly standard in franchise agreements, as it provides a degree of financial protection for the franchisor against potential losses due to customer default or incompletion of the agreement. Prospective Basecamp Fitness franchisees should be aware of these terms and ensure they fully understand the conditions under which the security deposit may be retained.