What standards must a transferee meet to be approved by Basecamp Fitness?
Basecamp_Fitness Franchise · 2025 FDDAnswer from 2025 FDD Document
otherwise give any third party a security interest in this Agreement in any manner whatsoever without our express prior written consent, which consent may be withheld for any reason whatsoever in our sole and absolute judgment.
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- In the event of a proposed Transfer by you we will not unreasonably withhold our consent to the Transfer so long as the conditions set forth below, as well as any other conditions we may impose, are all satisfied:
- The transferee meets our then current standards for the issuance of development rights, including satisfying any requirements imposed by applicable law, be of good moral character and reputation and shall have a good credit rating, financial capabilities and competent business qualifications reasonably acceptable to us. You shall provide us with the information we may reasonably require to make a determination concerning a proposed transferee;
- The transferee, including all shareholders, members and partners of the transferee, shall jointly and severally execute a new area development agreement with us on terms that are reasonably acceptable to us;
- If the transferee is a corporation, limited liability company or partnership, each stock or membership certificate, or the partnership agreement, shall have conspicuously endorsed upon it a statement that it is held subject to, and further Transfer of any interest therein is subject to, all restrictions imposed upon Transfer by this Agreement;
- If the transferee is a corporation, partnership, or limited liability company, no new voting interest in the transferee shall be issued to any person or entity without obtaining our prior written consent;
- You shall have fully paid and satisfied all of your obligations to us and our affiliates, including any under any Franchise Agreements for the operation of Basecamp Fitness studios; provided, however, you shall not be required to pay to us a transfer fee unless you are not transferring Franchise Agreements at that time because you have not opened any Basecamp Fitness studios, then you will pay a $7,500 transfer fee at the time of your transfer approval request;
- You shall have executed an agreement in form satisfactory to us in which you agree to: (i) release any claims you has against us and our affiliates; (ii) subordinate any claims you may have against the transferee to any amounts owed by the transferee to us; (iii) comply with the post-term obligations referenced in this Agreement, including the non-competition and confidentiality provisions; and (iv) indemnify us against all claims brought against us by the transferee for a period of three (3) years following the transfer;
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, if a franchisee wishes to transfer their rights to another party, the transferee must meet certain standards to gain approval from Basecamp Fitness. These standards include meeting the then-current requirements for the issuance of development rights. This involves satisfying any applicable legal requirements, demonstrating good moral character and reputation, and possessing a good credit rating, financial capabilities, and business qualifications that are reasonably acceptable to Basecamp Fitness. The franchisee is responsible for providing Basecamp Fitness with any information needed to assess the proposed transferee.
In addition to meeting the general standards, the transferee, along with all shareholders, members, and partners, must jointly and severally execute a new area development agreement with Basecamp Fitness on terms that are reasonably acceptable to them. If the transferee is a corporation, limited liability company, or partnership, each stock or membership certificate, or the partnership agreement, must have a conspicuous statement indicating that it is subject to transfer restrictions outlined in the agreement. Furthermore, no new voting interest in the transferee entity can be issued without prior written consent from Basecamp Fitness.
The transferring franchisee must also ensure that all financial obligations to Basecamp Fitness and its affiliates are fully satisfied, including obligations under any Franchise Agreements for operating Basecamp Fitness studios. The transferring franchisee must execute an agreement that releases any claims against Basecamp Fitness and its affiliates, subordinates any claims against the transferee to amounts owed to Basecamp Fitness, complies with post-term obligations (including non-competition and confidentiality provisions), and indemnifies Basecamp Fitness against claims brought by the transferee for three years following the transfer. However, the franchisee will not be required to pay a transfer fee unless they are not transferring Franchise Agreements at that time because they have not opened any Basecamp Fitness studios, then they will pay a $7,500 transfer fee at the time of their transfer approval request.
Basecamp Fitness retains the right to withhold consent to the transfer if these conditions are not met. However, Basecamp Fitness will not unreasonably withhold its consent if all conditions are satisfied. Basecamp Fitness also has the right to release any information it has regarding the development business or any Basecamp Fitness studio to any proposed transferee.