What constitutes 'cause' for termination of a Camp Margaritaville franchise due to non-curable defaults?
Camp_Margaritaville Franchise · 2025 FDDAnswer from 2025 FDD Document
| Provision | Section in franchise or other agreement | Summary | |
|---|---|---|---|
| h. | "Cause" defined – non curable defaults | Section 13.03 | Franchisee has no opportunity to cure: material misrepresentations; failure to comply with terms of the Franchise Agreement or System Standards 3 or more times in a 12 month period or 2 or more times in a 6 month period; failure to open and begin operating by Opening Deadline; franchisee, owner, or guarantor is convicted of a felony or a crime involving fraud; knowingly maintaining false books, records, or reports; unauthorized use or disclosure of confidential information; franchisee or guarantor admits insolvency or bankruptcy; ceases operation of the Resort; attempt at an unauthorized transfer; sale of contaminated or adulterated food or beverage two or more times during a twelve month period or once, when it results in serious injury or death; franchisee's or owner's assets block under anti terrorism; violation of restrictions relating to confidential information or restrictive covenants. |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER, AND DISPUTE RESOLUTION (FDD pages 64–68)
What This Means (2025 FDD)
According to Camp Margaritaville's 2025 Franchise Disclosure Document, there are specific instances that constitute 'cause' for termination of the franchise agreement due to non-curable defaults. These defaults provide Camp Margaritaville with grounds to terminate the agreement without offering an opportunity for the franchisee to correct the issue.
These non-curable defaults include: making material misrepresentations, failing to comply with the terms of the Franchise Agreement or System Standards three or more times in a 12-month period or two or more times in a 6-month period, failing to open and begin operating by the Opening Deadline, a conviction of the franchisee, owner, or guarantor of a felony or a crime involving fraud, knowingly maintaining false books, records, or reports, unauthorized use or disclosure of confidential information, franchisee or guarantor admits insolvency or bankruptcy, ceasing operation of the Resort, attempting an unauthorized transfer, selling contaminated or adulterated food or beverage two or more times during a twelve month period or once, when it results in serious injury or death, franchisee's or owner's assets block under anti terrorism, and violation of restrictions relating to confidential information or restrictive covenants.
These stipulations are important for a prospective Camp Margaritaville franchisee to understand, as any of these actions can lead to immediate termination of the franchise agreement. Franchisees should ensure they fully understand and adhere to all terms and standards outlined in the franchise agreement to avoid such defaults. The inclusion of acts such as convictions of felonies and selling contaminated food highlight the critical importance Camp Margaritaville places on legal compliance and brand protection.