Under what condition is the Atwell Suites agreement not assignable without express written consent?
Atwell_Suites Franchise · 2025 FDDAnswer from 2025 FDD Document
Client shall not assign or otherwise transfer this Agreement or any of its interest in this Agreement without the prior written consent of SCH. Except for the prohibition on assignment
Hotel Owner shall not assign or otherwise transfer this Agreement or any of its interest in this Agreement without the prior written consent of SCH, which consent shall not be unreasonably withheld or delayed. The Parties agree that it shall be reasonable for SCH to withhold consent to any such requested assignment or transfer if, among other reasons, the proposed assignee or transferee is not of good business reputation, is not financially sound or is a competitor of SCH. Notwithstanding the foregoing, Hotel Owner may, without SCH's consent, assign this Agreement to an entity which is controlled by, in control of or under common control with Hotel Owner, provided that Hotel Owner gives SCH written notice of such assignment within thirty (30) days following the effective date hereto.
Source: Item 23 — Receipts (FDD pages 99–486)
What This Means (2025 FDD)
According to the 2025 Atwell Suites FDD, the franchise agreement generally cannot be assigned or transferred by the franchisee (referred to as 'Client' or 'Hotel Owner') without obtaining prior written consent from SCH (Six Continents Hotels, Inc.). This means that an Atwell Suites franchisee cannot sell, give away, or otherwise transfer their rights and obligations under the franchise agreement to another party unless Atwell Suites approves it in writing.
However, there are some exceptions to this rule. For instance, the agreement states that SCH's consent will not be unreasonably withheld or delayed. It would be deemed reasonable for SCH to withhold consent if the proposed assignee or transferee lacks a good business reputation, is not financially sound, or is a competitor of SCH.
Additionally, the agreement outlines a specific scenario where the Hotel Owner may assign the agreement without SCH's consent. This is permissible if the assignment is to an entity controlled by, in control of, or under common control with the Hotel Owner, provided that SCH receives written notice of the assignment within thirty (30) days of its effective date. This provides some flexibility for internal restructuring or transfers within the franchisee's existing business organization.