Does maintaining the insurance requirement relieve a Basecamp Fitness franchisee of indemnification obligations?
Basecamp_Fitness Franchise · 2025 FDDAnswer from 2025 FDD Document
B. Relationship; Your Indemnification. We and you are independent contractors. Neither we nor you will make any agreements, representations, or warranties in the name of or on behalf of the other or that our relationship is other than franchisor and franchisee. Neither we nor you will be obligated by or have any liability under any agreements, representations or warranties made by the other nor will we be obligated for any damages to any person or property directly or indirectly arising out of the operation of your Basecamp Studio. You assume sole and complete responsibility for and will defend at your own cost and indemnify, reimburse and hold harmless us, our affiliates and our respective officers and directors from and against all loss, costs, expenses, obligations and damages and liabilities (including defense costs) arising directly or indirectly out of the development or operation of your Basecamp Studio, including, without limitation, claims relating to your employment practices, equipment selection, and floor plan, you or your employees' actions or inactions and any amounts we pay on your behalf. You will have the right to defend any such claim against you. We, using our own counsel, by notice to you, may control any matter in which we are named or directly affected, but this will not affect your liability to pay all attorneys' fees we incur in defending ourselves, which obligation is part of your indemnification obligation. The indemnities and assumptions of liabilities and obligations set forth in this Agreement will continue in full force and effect subsequent to the expiration or termination of this Agreement.
Source: Item 22 — CONTRACTS (FDD pages 61–62)
What This Means (2025 FDD)
According to Basecamp Fitness's 2025 Franchise Disclosure Document, maintaining the required insurance coverage does not relieve a franchisee of their indemnification obligations. The franchisee is still responsible for defending and indemnifying Basecamp Fitness, its affiliates, and their officers and directors from any losses, costs, expenses, obligations, damages, and liabilities arising from the development or operation of the franchisee's Basecamp Studio. This includes claims related to employment practices, equipment selection, floor plans, and actions or inactions of the franchisee or their employees.
The franchisee's indemnification obligations extend to covering Basecamp Fitness's legal defense costs if Basecamp Fitness chooses to defend itself in a matter where it is named or directly affected. This means that even if the franchisee has insurance, they are still responsible for covering Basecamp Fitness's attorney's fees incurred in defending themselves.
This indemnification clause remains in effect even after the franchise agreement expires or is terminated. Therefore, a Basecamp Fitness franchisee's responsibility to indemnify the franchisor is a long-term obligation that is not waived by simply maintaining the required insurance coverage.