Under what circumstance related to the opening deadline can a Camp Margaritaville franchisee face termination?
Camp_Margaritaville Franchise · 2025 FDDAnswer from 2025 FDD Document
Section 13.03 Events of Default Without Opportunity to Cure. Franchisor may, but has no duty to, exercise any of the remedies in Article XIV including, but not limited to terminating this Agreement if any of the following occur, all of which shall constitute an Event of Default by Franchisee under this Agreement, immediately upon the occurrence of such Event of Default (or the earliest date permitted by law) without notice to Franchisee:
(a) Franchisee or its Owners is discovered to have misrepresented or omitted a material fact which induced Franchisor to enter into this Agreement;
- (b) Franchisee fails to open and begin operating the Resort by the Opening Deadline (as may be extended pursuant to Section 2.08(b));
Source: Item 23 — RECEIPTS (FDD pages 72–406)
What This Means (2025 FDD)
According to Camp Margaritaville's 2025 Franchise Disclosure Document, a franchisee can face termination if they fail to open and begin operating their resort by the specified opening deadline, which may be extended under certain conditions. Specifically, Section 13.03(b) states that the franchisor has the right to terminate the agreement if the franchisee does not meet the opening deadline, as it would be considered an event of default. This is without opportunity to cure the default.
The opening deadline is determined based on whether the resort is new construction or an adaptive reuse. For new constructions, the franchisee has 24 months from the effective date of the agreement to open. For adaptive reuse projects, the deadline is 18 months from the effective date, unless otherwise specified in the Property Improvement Plan (PIP).
It's important to note that the franchisee can request an extension of the opening deadline by submitting a written request and a $10,000 extension fee to Camp Margaritaville before the original deadline. However, the franchisor has the discretion to approve or deny the extension. If the extension is denied, the fee is refunded, and the original deadline remains in place. If the extension is approved, a new deadline is set, and the extension fee is non-refundable. Failing to open by either the original or extended deadline can result in the termination of the franchise agreement by Camp Margaritaville.