Under what conditions can Basecamp Fitness withhold consent for a franchise transfer?
Basecamp_Fitness Franchise · 2025 FDDAnswer from 2025 FDD Document
Wherever our consent or approval is required in this Agreement, unless the provision specifically indicates otherwise, we have the right to withhold our approval in our discretion, for any reason, or for no reason.
When the terms of this Agreement specifically require that we not unreasonably withhold our approval or consent, if you are in default or breach under this Agreement, any withholding of our approval or consent will be considered reasonable.
Our approvals and consents will not be effective unless given in writing.
Unless otherwise provided in this Agreement, we will not unreasonably withhold, delay or condition our consent to a Transfer, subject to all of the following conditions being satisfied:
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- you are in full compliance with this Agreement, you have no uncured defaults, and all your debts and financial obligations to us and our affiliates are current;
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- you provide us with all information we may require concerning the proposed transaction (including a copy of the purchase agreement and all related documents), and the proposed transferee;
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- prior to the date of the proposed Transfer, the proposed transferee's Principal Operator successfully completes such training and instruction as we deem necessary;
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- you and all holders of an interest in you sign a general release, in the form prescribed by us, releasing, to the fullest extent permitted by law, all claims that you or any of your investors may have against us and our affiliates, including our and their respective shareholders, officers, directors and employees, in both their individual and corporate capacities;
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- prior to the Transfer, you or the proposed transferee pay to us or the applicable broker, as we designate, any broker fees or commissions that we or you incur in connection with the Transfer; and
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- prior to the Transfer, you pay us a transfer fee of Seven Thousand Five Hundred Dollars ($7,500), but if Transfer occurs before the opening of your Basecamp Studio the transfer fee is Fifteen Thousand Dollars ($15,000).
We may expand upon, and provide more details related to, the conditions for transfer and our consent as described in this Section 13.B, and may do so in the Manual or otherwise in writing.
Source: Item 22 — CONTRACTS (FDD pages 61–62)
What This Means (2025 FDD)
According to Basecamp Fitness's 2025 Franchise Disclosure Document, Basecamp Fitness has broad discretion regarding franchise transfers. Unless specifically stated otherwise in the franchise agreement, Basecamp Fitness can withhold approval for any reason or no reason. However, if the agreement requires that Basecamp Fitness not unreasonably withhold approval, doing so while the franchisee is in default or breach of the agreement is considered reasonable. Any approvals or consents from Basecamp Fitness must be given in writing to be effective. This gives Basecamp Fitness significant control over who can become a franchisee within their system.
Specifically, Basecamp Fitness will not unreasonably withhold, delay, or condition consent to a transfer if all of the following conditions are satisfied: the franchisee is in full compliance with the agreement, has no uncured defaults, and all debts and financial obligations to Basecamp Fitness and its affiliates are current. The franchisee must also provide all required information concerning the proposed transaction, including a copy of the purchase agreement and all related documents, and information about the proposed transferee. The proposed transferee's Principal Operator must successfully complete the training and instruction that Basecamp Fitness deems necessary.
Furthermore, the franchisee and all holders of an interest in the franchisee must sign a general release, in the form prescribed by Basecamp Fitness, releasing all claims against Basecamp Fitness and its affiliates. Prior to the transfer, the franchisee or the proposed transferee must pay any broker fees or commissions incurred by Basecamp Fitness or the franchisee in connection with the transfer. Additionally, a transfer fee of $7,500 must be paid to Basecamp Fitness prior to the transfer, but if the transfer occurs before the Basecamp Studio opens, the transfer fee is $15,000. Basecamp Fitness may expand upon these conditions for transfer and consent in the Manual or in writing.
This level of detail and these conditions are fairly typical in franchise agreements. The transfer fee is also a common practice, intended to cover Basecamp Fitness's administrative costs and ensure that any new franchisee meets their standards. Prospective franchisees should carefully consider these conditions and the potential for Basecamp Fitness to withhold consent, as it could impact their ability to sell the franchise in the future.