What are the non-curable defaults that could lead to termination of the Basecamp Fitness Franchise Agreement?
Basecamp_Fitness Franchise · 2025 FDDAnswer from 2025 FDD Document
All rights granted in this Agreement immediately terminate upon written notice without opportunity to cure if: (i) you become insolvent, commit any affirmative action of insolvency or file any action or petition of insolvency; (ii) a receiver (permanent or temporary) of your property is appointed by a court of competent authority; (iii) you make a general assignment or other similar arrangement for the benefit of your creditors; (iv) a final judgment against you remains unsatisfied of record for thirty (30) days or longer; (v) execution is levied against your business or property, or the business or property of any of your affiliates that have entered into Franchise Agreements with us; (vi) a suit to foreclose any lien or mortgage against premises or equipment is instituted against you and not dismissed within thirty (30) days, or is not in the process of being dismissed; (vii) you fail to timely meet any of your obligations set forth in the Development Schedule or you fail to comply with our requirements for securing real estate for any Basecamp Fitness Studio; (viii) you or any of your affiliates open any Basecamp Fitness Studio before that person or entity
has signed a Franchise Agreement with us for that studio in the form we provide; (ix) you fail to comply with any other provision of this Agreement, or your or any of your affiliates fail to comply with any other agreement you or they have with us or our affiliates and do not correct the failure within thirty (30) days after written notice of that failure is delivered to the breaching party (except that if the failure to comply is the third failure to comply with any provision of any agreement that you or any of your affiliates have with us or an affiliate of ours within any twelve (12) consecutive month period, then we need not provide any opportunity to cure the default); or (x) we have delivered to you or any of your affiliates a notice of termination of a Franchise Agreement in accordance with its terms and conditions.
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, there are several conditions under which the Area Development Agreement can be immediately terminated without an opportunity to cure the default. These include instances of insolvency, such as becoming insolvent, committing an affirmative action of insolvency, or filing any action or petition of insolvency. The appointment of a receiver for the franchisee's property by a court of competent authority also constitutes a non-curable default. Making a general assignment or similar arrangement for the benefit of creditors is another such condition.
Further non-curable defaults include having a final judgment against the franchisee that remains unsatisfied for 30 days or longer, or if execution is levied against the business or property of the franchisee or any of their affiliates who have entered into Franchise Agreements with Basecamp Fitness. Additionally, the institution of a suit to foreclose any lien or mortgage against the premises or equipment, which is not dismissed within 30 days or is not in the process of being dismissed, is considered a non-curable default. Failing to meet obligations in the Development Schedule or failing to comply with Basecamp Fitness's requirements for securing real estate for any Basecamp Fitness Studio also leads to immediate termination.
Opening a Basecamp Fitness Studio before signing a Franchise Agreement with Basecamp Fitness for that studio, in the form they provide, is another non-curable default. Finally, if Basecamp Fitness has delivered a notice of termination of a Franchise Agreement to the franchisee or any of their affiliates in accordance with its terms and conditions, the Area Development Agreement can be immediately terminated. These stipulations outline significant risks for a prospective Basecamp Fitness franchisee, as these defaults provide no opportunity to rectify the situation and maintain the agreement.