Under what circumstances might Baymont Inn Suites terminate a franchisee's Protected Territory?
Baymont_Inn_Suites Franchise · 2025 FDDAnswer from 2025 FDD Document
nt, or (b) as of the date that a date for the premature termination of the Franchise Agreement has been confirmed in writing by us. During the term of your Franchise Agreement, neither you nor your owners, officers or directors may own, lease, manage or franchise a timeshare resort, vacation or residence club, fractional ownership residence, condominium/apartment leasing or rental business, or the like, for any facility or business that shares directly or indirectly, any common areas, amenities, recreation facilities, services, supplies or support activities with the Facility. You are also prohibited from promoting a different or competing business, including advertising hotels other than Chain Facilities or those of the Lodging Affiliates, and advertising any timeshare or vacation ownership resort not affiliated with us or our current and former affiliates. If you breach this obligation, we may terminate your Protected Territory. Your Protected Territory may be impacted upon a Notice of Condemnation or notice of termination. We have no other rights to modify your Protected Territory during the term of your Franchise Agreement.
We grant you a franchise to operate a Chain Facility only for a specific location we approve. Relocation of a Facility or the establishment of additional Chain Facilities is subject to our usual application procedures and requires the execution of additional Franchise Agreements.
Source: Item 12 — TERRITORY (FDD pages 74–76)
What This Means (2025 FDD)
According to Baymont Inn Suites's 2025 Franchise Disclosure Document, the franchisor may terminate a franchisee's protected territory under specific circumstances. Baymont Inn Suites may terminate the Protected Territory if the franchisee breaches the obligation not to own, lease, manage, or franchise certain types of businesses (timeshare resort, vacation or residence club, fractional ownership residence, condominium/apartment leasing or rental business) that share common areas, amenities, or services with the Baymont Inn Suites facility. Additionally, franchisees are prohibited from promoting different or competing businesses, including advertising hotels other than Chain Facilities or those of the Lodging Affiliates, and advertising any timeshare or vacation ownership resort not affiliated with Baymont Inn Suites or its affiliates. A Notice of Condemnation or notice of termination may also impact the Protected Territory.
It is important to note that Baymont Inn Suites retains the right to operate, lease, manage, or license a Chain Facility in the Protected Territory beginning six months before the Franchise Agreement expires or from the date a premature termination date is confirmed in writing by Baymont Inn Suites. This means that even within the Protected Territory, Baymont Inn Suites can begin setting up competing facilities as the end of the franchise term approaches.
Prospective franchisees should carefully review the definition of "Protected Territory" in Section 2 of the Franchise Agreement to fully understand its scope and any potential limitations. They should also seek clarification from Baymont Inn Suites regarding what constitutes a breach of the obligations related to operating or promoting competing businesses, as this could lead to termination of the Protected Territory. Understanding these conditions is crucial for assessing the risks and benefits associated with the franchise.