Under what conditions can changes be made to the Atwell Suites license agreement?
Atwell_Suites Franchise · 2025 FDDAnswer from 2025 FDD Document
Notwithstanding anything to the contrary set forth in the above License Agreement ("License"), the following provisions shall supersede and apply to each License for an Atwell Suites Hotel issued in the State of California:
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- In accordance with the provisions under Federal Bankruptcy Law (11 U.S.C.A. Sec. 101 et seq.), paragraphs 11.C(1)(b) and (d) of the License shall be amended to include the following language: "Enforceability of this provision is a matter governed by Federal Bankruptcy Law and enforceability or nonenforceability is subject to that law and rulings of a court of competent jurisdiction."
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- California Business and Professions Code Sections 20000 through 20043 provide rights to the Licensee concerning termination or non-renewal of a License. If the License contains a provision that is inconsistent with the law, the law will control.
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- The License contains a liquidated damages clause. Under California Civil Code Section 1671, certain liquidated damages clauses are unenforceable,
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- The License and Guaranty require application of the laws of Georgia. In accordance with 5050.23 Sec. 310.114.1(c)(5)(B)(v), this provision may not be enforceable under California law.
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- With respect to franchises sold in California, a franchisor is prohibited from modifying a franchise agreement, or requiring a general release, in exchange for any assistance related to a declared state or federal emergency.
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- This Amendment may be executed in counterparts, which together shall constitute one and the same instrument. Signatures via Conga Sign, DocuSign, .PDF file, facsimile, or other electronic format have the same force and effect as originals.
Source: Item 23 — Receipts (FDD pages 99–486)
What This Means (2025 FDD)
According to the 2025 FDD, the Atwell Suites license agreement can be changed under specific conditions, primarily through amendments that address state-specific franchise laws. These amendments take precedence over the original agreement within the relevant state's jurisdiction.
For instance, amendments are made to comply with franchise laws in states like California, Hawaii, Illinois, Maryland, Minnesota, New York, North Dakota, Rhode Island, and Virginia. These amendments cover various aspects, such as termination and non-renewal rights, liability, and the enforceability of certain clauses like those related to liquidated damages or venue selection. In several states, the amendments address the enforceability of provisions under Federal Bankruptcy Law.
These state-specific amendments ensure that Atwell Suites' franchise agreements align with local regulations, providing franchisees with rights and protections mandated by state laws. Prospective franchisees should carefully review the amendment specific to their state to understand how it modifies the original license agreement and what rights and obligations it entails.