During the AOP Term, what is Camp Margaritaville prohibited from doing within the Area of Protection?
Camp_Margaritaville Franchise · 2025 FDDAnswer from 2025 FDD Document
If you are granted an Area of Protection, it may be limited to a period of time that is shorter than the term of the Franchise Agreement (e.g., 5 years from opening) (the "AOP Term"). Within the Area of Protection and during the AOP Term, we will not open or authorize any third party to open any Resort using the same or materially similar branding as your Resort. The Area of Protection will not apply to other lodging brands licensed or franchised by us or our affiliates, which may include "by Margaritaville" or other similar secondary reference to us in their branding. The Area of Protection also will not apply to other types of lodging properties licensed or franchised by us or our affiliates, such as hotels and resorts, residential/rental dwellings, condos, apartments, active adult living communities, timeshares, and/or student housing.
Source: Item 12 — TERRITORY (FDD pages 55–57)
What This Means (2025 FDD)
According to Camp Margaritaville's 2025 Franchise Disclosure Document, if a franchisee is granted an Area of Protection (AOP), the franchisor, during the AOP Term, will not open or authorize any third party to open a Resort using the same or materially similar branding as the franchisee's Resort. The AOP Term may be shorter than the full term of the Franchise Agreement, for example, five years from opening. This means that for the duration of the AOP Term, Camp Margaritaville commits to not directly compete with its franchisee within the defined area by establishing another Camp Margaritaville location with similar branding.
However, the Area of Protection does not extend to other lodging brands licensed or franchised by Camp Margaritaville or its affiliates, even if they include "by Margaritaville" or a similar reference. This exception also applies to other types of lodging properties such as hotels, resorts, residential/rental dwellings, condos, apartments, active adult living communities, timeshares, and student housing. Therefore, while Camp Margaritaville will not authorize another Camp Margaritaville-branded resort within the Area of Protection, other Margaritaville-affiliated lodging options are still possible.
This distinction is important for prospective franchisees to understand, as other Margaritaville-branded properties could still operate nearby, potentially drawing customers and impacting the franchisee's business. Franchisees should carefully evaluate the potential for competition from these other brands when considering a Camp Margaritaville franchise and negotiating the terms of their Area of Protection. It is also important to note that Camp Margaritaville retains the right to sell or license others to sell competitive or identical goods or services through alternative channels of distribution, such as online sales of branded merchandise, even within the Area of Protection.