What is the non-refundable processing fee that a Crowne Plaza licensee must submit to IHG with the offering materials for the registration of a proposed transfer of equity interests?
Crowne_Plaza Franchise · 2025 FDDAnswer from 2025 FDD Document
le of securities in or by Licensee or the Hotel ("Securities") requires IHG's consent. All materials for the offer or sale of those Securities disseminated to any prospective purchaser thereof, filed with any governmental or quasigovernmental entity or intended for distribution to any form of media must be submitted to IHG for its review at least sixty (60) days before the date Licensee disseminates or distributes those materials or files them with any governmental agency, including any materials to be used in any offering exempt from registration under any securities laws. Licensee must submit to IHG a non-refundable Twenty-Five Thousand Dollar ($25,000) processing fee with the offering materials and pay any additional costs IHG may incur in reviewing such materials, including reasonable attorneys' fees. Except as legally required to describe the Hotel in the offering materials,
Licensee may not use any of the Marks or otherwise imply IHG's participation or that of its Affiliates, or any of their respective officers, directors, members, managers and employees in such offering or its/th
Source: Item 23 — Receipts (FDD pages 100–424)
What This Means (2025 FDD)
According to the 2025 Crowne Plaza Franchise Disclosure Document, a licensee must submit a non-refundable processing fee of $25,000 to IHG with the offering materials for the registration of a proposed transfer of equity interests. This fee covers IHG's costs for reviewing the offering materials.
The $25,000 fee is non-refundable, meaning that even if the proposed transfer does not proceed or is not approved, the licensee will not receive this money back. In addition to the processing fee, the licensee is also responsible for paying any additional costs IHG incurs while reviewing the materials, including reasonable attorney's fees. This could potentially add a significant expense to the transfer process.
Crowne Plaza also stipulates that the licensee cannot use any of the brand's trademarks or imply IHG's participation or endorsement in the offering materials, unless legally required to describe the hotel. IHG retains the right to approve any description of the license or the licensee's relationship with IHG in the offering documents. However, IHG's review does not constitute an agreement with any statements in the documents, including financial projections, or an acknowledgment of compliance with applicable laws.
This requirement ensures that IHG maintains control over how the Crowne Plaza brand is represented in connection with any sale of securities related to the franchise. Prospective franchisees should carefully consider these costs and restrictions when planning any transfer of equity interests.