In the Crowne Plaza FDD, what constitutes 'Control' over a Person?
Crowne_Plaza Franchise · 2025 FDDAnswer from 2025 FDD Document
Licensee agrees that its obligations to indemnify and hold harmless IHG and the other indemnitees under paragraphs 8.A. and 13.K. of this License extends to and embraces liabilities arising from or relating to, directly or indirectly, any and every element of Licensee's offer and/or sale of Securities which Licensee may propose to or does engage in, including (without limitation) any statements, representations or warranties that Licensee and/or its Affiliates may give to or receive from any proposed or actual purchaser of such Securities and/or any claim that Licensee, its Affiliates and/or the officers, directors, managers, members, agents and employees of each of the foregoing, or Licensee's assignee, engaged in fraud, deceit, violation of securities laws or other illegality in connection with Licensee's proposed or actual offer and/or sale of Securities. As with all other indemnification obligations set forth in this License, this specific indemnification obligation will survive the termination or expiration of this License.
F. Control Transfers.
Notwithstanding any other term or provision of this License to the contrary, neither this License nor any right or interest herein is assignable or transferable by Licensee.
If Licensee (i) receives an offer to purchase or lease the Hotel or any portion thereof, (ii) desires to sell or lease the Hotel or any portion thereof, or (iii) wishes to convey the Hotel, Hotel site, or any interest in the Hotel or Licensee, Licensee shall give prompt written notice thereof to IHG, stating the identity of the prospective transferee, purchaser or lessee and the terms and conditions of the conveyance, including a copy of any proposed agreement and all other information with respect thereto, that IHG may reasonably require.
Any (i) transfer of Equity Interests in an Entity (other than a transfer expressly pe
Source: Item 23 — Receipts (FDD pages 100–424)
What This Means (2025 FDD)
Based on the 2025 Crowne Plaza Franchise Disclosure Document, the document specifies conditions related to the transfer of the license and interests in the hotel but does not explicitly define what constitutes 'Control' over a person. The FDD states that the Licensee cannot assign or transfer the license or any rights associated with it.
The document outlines that if a Licensee receives an offer to purchase or lease the hotel, desires to sell or lease the hotel, or wishes to convey the hotel, hotel site, or any interest in the Licensee, they must promptly notify IHG in writing. This notice must include the identity of the prospective transferee, purchaser, or lessee, as well as the terms and conditions of the conveyance, including any proposed agreements and other information that IHG may reasonably require.
While the FDD does not define 'Control,' it does address scenarios where changes in ownership or management could occur, requiring notification to Crowne Plaza. A prospective franchisee should seek clarification from Crowne Plaza regarding the specific criteria used to determine 'Control' and how it might affect the franchise agreement.