When entering into the Crowne Plaza agreement, on what basis should the client acknowledge they are entering the agreement?
Crowne_Plaza Franchise · 2025 FDDAnswer from 2025 FDD Document
RECITALS
- A. IHG owns and licenses the "Brand System" (as defined in paragraph 1.B. below). Licensee is the owner of the Hotel and has requested a license to use the Brand System to operate the Hotel as a Brand System Hotel (as defined in paragraph 1.B. below).
- B. IHG shall grant to Licensee a non-exclusive license to operate the Hotel as a Brand System Hotel, subject to the terms of this License.
- C. Guarantor(s) will provide the Guaranty.
- D. In granting this non-exclusive license, IHG has relied upon the business skill, financial capacity, and character of Licensee and the Guaranty to be provided by the Guarantor(s).
NOW, THEREFORE, in consideration of the promises and covenants in this License, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, IHG and Licensee agree as follows:
1. The License:
The Brand System is designed to provide a distinctive, high quality hotel service to the public under the name "Crowne Plaza®". High standards established by IHG are the essence of the Brand System. Future investments may be required of Licensee under this License. Licensee desires to enter into this License in order to obtain a license to use the Brand System in the operation of a hotel located at the "Location" identified on Attachment "A" and defined in paragraph 2.A. below (the "Hotel").
Source: Item 23 — Receipts (FDD pages 100–424)
What This Means (2025 FDD)
According to the 2025 Crowne Plaza FDD, IHG grants the licensee a non-exclusive license to operate a hotel under the Crowne Plaza brand. This is subject to the terms outlined in the license agreement. The licensee acknowledges the receipt and sufficiency of the promises and covenants detailed in the license agreement as valuable consideration for entering into the agreement. IHG relies on the business skill, financial capacity, and character of the licensee, as well as any provided guaranty when granting this license.
Crowne Plaza emphasizes that the Brand System is designed to deliver distinctive, high-quality hotel service. The high standards set by IHG are central to the Brand System, and licensees may be required to make future investments to maintain these standards. The licensee enters the agreement to gain the right to use the Brand System in operating a hotel at a specific location, as identified in the agreement.
For prospective Crowne Plaza franchisees, this means understanding that the agreement is based on mutual promises and obligations. The franchisor's decision to grant the license is influenced by the franchisee's capabilities and financial stability. Franchisees should carefully review all terms and conditions to fully understand their commitments and the standards they must uphold as part of the Crowne Plaza brand.