Who is responsible for reimbursing costs incurred in the collection of unpaid amounts to Basecamp Fitness?
Basecamp_Fitness Franchise · 2025 FDDAnswer from 2025 FDD Document
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, the franchisee is responsible for costs incurred pertaining to the operation of their Basecamp Studio. Specifically, the franchisee will indemnify, reimburse, and hold harmless Basecamp Fitness, its affiliates, and their respective officers and directors from and against all losses, costs, expenses, obligations, damages, and liabilities (including defense costs). This includes costs arising directly or indirectly out of the development or operation of the franchisee's Basecamp Studio.
This broad indemnification clause means that as a Basecamp Fitness franchisee, you are financially responsible for a wide range of potential costs and liabilities associated with running your studio. This includes legal defense costs, damages, and other expenses that Basecamp Fitness might incur due to your studio's operations. The franchisee is responsible for claims relating to their employment practices, equipment selection, floor plan, or actions/inactions of the franchisee or their employees.
Basecamp Fitness retains the right to control any matter in which they are named or directly affected, using their own counsel. However, the franchisee remains liable for all attorneys' fees incurred by Basecamp Fitness in defending themselves. This obligation is part of the franchisee's indemnification responsibility. This arrangement means that even if Basecamp Fitness takes control of a legal matter, the franchisee is still responsible for covering their legal expenses.
This indemnification obligation continues even after the franchise agreement expires or is terminated. Therefore, even after the franchisee is no longer operating a Basecamp Fitness studio, they may still be responsible for costs and liabilities that arose during the term of the agreement. Franchisees should carefully consider the scope of this indemnification clause and its potential financial implications.