Is Baymont Inn Suites obligated to offer or issue a TPA to the Franchisee?
Baymont_Inn_Suites Franchise · 2025 FDDAnswer from 2025 FDD Document
sing of the Loan.
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- Franchisee requests that upon receipt of this request form executed by Franchisee and its guarantor or guarantors, Franchisor prepare and offer to Lender its standard form of TPA, which
will require Lender or an affiliate to assume the Franchise Agreement for the Facility and cure Franchisee's defaults if Lender or an affiliate takes possession of the Facility.
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- Franchisee acknowledges and confirms that Franchisor shall be indemnified and held harmless by Franchisee and each guarantor of Franchisee's obligations under the Franchise Agreement against any claim, liability, judgment, settlement, cause of action, and damage award in favor of Lender against Franchisor arising from or relating to Franchisee's breach of this request or the TPA; that such indemnification shall be subject to the indemnification provision of the Franchise Agreement; and that Franchisee's indemnification obligation represents partial consideration from Franchisee for Franchisor to review this request and to offer and issue the TPA. Franchisee acknowledges Franchisor is under no obligation to offer or issue the TPA, which inures to the primary benefit of Franchisee and its guarantor or guarantors.
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- Franchisee acknowledges that Franchisor has no obligation to modify its standard form of TPA and shall have no liability to Franchisee or any guarantor as result of the inability of Lender and Franchisor to reach agreement on the language of the TPA or the failure of Lender and Franchisor to execute the TPA for any other reason. Franchisee and each guarantor jointly and severally release any and all causes of action and claims against Franchisor arising from the furnishing to Lender information about the Facility, the Franchise Agreement, or Franchisee under this request or the TPA, or the denial of the Loan or refusal to close the Loan arising from the inability of the parties to agree upon and execute a mutually-acceptable TPA, or for any other reason.
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- Franchisee covenants to forward to Lender copies of all default notices from Franchisor sent to Franchisee that the Loan documents require that Lender receive.
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- If Franchisee requests certain changes to the Franchise Agreement in order for the loan to qualify for financing assistance from the U.S. Small Business Administration, Franchisor will effect such changes so long as the Agreement maintains the mutuality of obligations, rights, and powers between Franchisee and Franchisor as to any affected provision.
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- Franchisee acknowledges that the TPA shall not be effective and binding on Franchisor unless and until Franchisor receives at its home office in Parsippany, New Jersey an original TPA signed by authorized representatives of each of Franchisee and Lender. Franchisor will offer the TPA to Lender subject to such condition as to its effectiveness. Franchisee undertakes to confirm with Lender at the closing of the Loan, or at such other time as may be requested by Lender (if the Loan has closed prior to the execution of the TPA) that the TPA has been fully executed and sent to Franchisor. Franchisor may, in its sole discretion, withhold its signature and delivery of the TPA until it has received evidence satisfactory to Franchisor that the Loan has closed.
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Source: Item 22 — CONTRACTS (FDD pages 96–97)
What This Means (2025 FDD)
According to Baymont Inn Suites's 2025 Franchise Disclosure Document, Baymont Inn Suites is under no obligation to offer or issue a Three-Party Agreement (TPA) to the franchisee. The FDD specifies that the franchisee acknowledges this lack of obligation. The TPA primarily benefits the franchisee and any guarantors. Baymont Inn Suites also has no obligation to modify its standard TPA form and bears no liability if an agreement on the TPA language cannot be reached with the lender, or if the TPA is not executed for any reason.
Furthermore, the franchisee is required to pay a non-refundable fee of $1,000 to Baymont Inn Suites for the review of the TPA request, which is not refundable even if a TPA is not ultimately agreed upon. The franchisee also authorizes Baymont Inn Suites to release information about the franchisee's account, the status of the Franchise Agreement, quality assurance inspections, and guest complaints to the lender. However, Baymont Inn Suites is not obligated to do so or to provide a copy of the Franchise Agreement to the lender, making it the franchisee's responsibility to ensure the lender has a complete copy if requested.
If the franchisee is not already in a franchise agreement with Baymont Inn Suites for the facility, the offer and issuance of the TPA is contingent upon the execution of such an agreement, payment of the initial fee, and receipt of any other documents Baymont Inn Suites deems necessary. Baymont Inn Suites may withhold its signature and delivery of the TPA until it receives satisfactory evidence that the loan has closed. The franchisee also agrees to indemnify Baymont Inn Suites against any claims from the lender arising from the franchisee's breach of the TPA request or the TPA itself.