For Basecamp Fitness, who is required to sign a personal guarantee of the franchisee's obligations under the Franchise Agreement and the Development Agreement?

According to Basecamp Fitness's 2025 Franchise Disclosure Document, if the franchisee is a business entity, each owner of that entity, along with their spouse, must sign a personal guarantee. This guarantee covers all obligations of the franchisee under both the Franchise Agreement and the Development Agreement.

This requirement means that individuals who own a Basecamp Fitness franchise through a corporation, LLC, or other business structure cannot shield themselves completely from personal liability. The personal guarantee ensures that Basecamp Fitness can seek recourse directly from the owners' personal assets if the franchise fails to meet its financial or contractual obligations. This is a standard practice in franchising, as it provides the franchisor with added security and demonstrates the owners' commitment to the business.

Furthermore, the personal guarantee for Basecamp Fitness includes an agreement to be bound by the confidentiality and noncompete provisions outlined in the Franchise Agreement. This means that owners are personally responsible for maintaining the confidentiality of Basecamp Fitness's proprietary information and adhering to the noncompete clauses, even if they later leave the business. This provision protects Basecamp Fitness's trade secrets and market position.

Prospective Basecamp Fitness franchisees should carefully consider the implications of signing a personal guarantee. They should consult with legal and financial advisors to fully understand the risks and obligations involved. It is also important to assess the financial stability of the business entity and the potential impact on personal assets in the event of business failure.