What is the processing fee required by Holiday for a transfer of a Crowne Plaza license, and when must it be paid?
Crowne_Plaza Franchise · 2025 FDDAnswer from 2025 FDD Document
| Provision | Section In | Summary | |
|---|---|---|---|
| Agreement | |||
| a. Length of the license term (Note 1) | License: 11.A | The term begins on the Effective Date and expires 20 years from date Hotel opens in the Brand System for a new development; 10 or more years from date Hotel opens in the Brand System for a conversion; and 10 or more years from Effective Date for a change of ownership or re-licensing. | |
| b. Renewal or | Not applicable (see | The License does not provide for | |
| extension of term | License: 11.A) | renewal or term extensions. | |
| c. Requirements for you to renew or extend | Not applicable (see License: 11.A) | The License does not provide for renewal or term extensions. If we agree to Re-license, you may be asked to sign a contract with materially different terms and conditions than your original contract. | |
| d. Termination by you | Not applicable | ||
| e. Termination by | License: Not | MTSA may be terminated by IHG Tech | |
| Holiday without | applicable | for convenience on 90 days’ prior | |
| Cause | MTSS: 10.1 | written notice to the licensee. | |
| f. Termination by Holiday with Cause (Notes 2 and 3) | License: 11.B, 11.C, 13.J and Attachment B MTSS: 10.3 | Holiday may terminate with cause. You pay liquidated damages if Holiday terminates under Paragraphs 11.B, 11.C, or 13.J. Termination may occur for failure to perform “The Work”. See Notes 2 and 4 and Exhibit B. | |
| g. "Cause" defined – | License: 11.B, | Any default other than those listed in | |
| defaults which can | “h” below. | ||
| be cured (Note 3) | See Note 2. | ||
| h. "Cause" defined – non-curable defaults | License: 10, 11.C and Attachment B | Non-curable defaults: bankruptcy; non- dismissed judgments exceeding $50,000; trademark misuse, or if you contest Holiday's ownership of trademarks; loss of possession of the property; dissolution of the licensee entity; failure to identify or operate the Hotel as a Brand System Hotel; violation of Licensor’s proprietary | |
| Provision | Section In Agreement | Summary rights; unapproved transfers; conviction of a felony; false books and records; failure to comply with safety, security or privacy of your guests or reputation standards; condemnation or casualty occurs and Hotel does not reopen when required; unauthorized use of Marks; and, refusal to allow inspection or audit. | |
| i. | Your obligations upon termination/ non-renewal | License: 7.A. 11.D, 11.E, 13.J and Attachment "B" MTSS,13.1 & Attachment 4-1 to Schedule 4 | Obligations include de-identification and payment of amounts due. |
| j. | Assignment of License by Holiday | License: 9.A | Holiday has rights of assignment to any person or legal entity. |
| k. | "Transfer" by you – definition | License: 9.B | Includes transfer of contract or assets (including real estate) or ownership changes. |
| l. | Holiday's approval of transfer by You | License: 9 | Holiday has the right to approve all transfers. |
| m. | Conditions for Holiday's approval of transfers | License: 9.C, 9.D, 9.E and 9.F | The prospective new owner of the Hotel or Licensee must submit an application and all fees to keep the Hotel in the Brand System. Holiday will evaluate the new owner's application using then-current procedures and criteria such as credit, operational abilities, market feasibility, prior busines |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 87–91)
What This Means (2025 FDD)
According to Crowne Plaza's 2025 Franchise Disclosure Document, Holiday requires a non-refundable $25,000 processing fee for the transfer of a license. This fee must be paid at least 60 days before any public offering, private placement, or other sale of securities related to the transfer. This condition is part of Holiday's broader right to approve all transfers of Crowne Plaza licenses, ensuring that new owners meet their standards.
For a prospective Crowne Plaza franchisee, this means that if they decide to sell their franchise, they must navigate the approval process with Holiday, which includes this $25,000 fee. This fee is in addition to any other costs associated with the sale, such as legal and brokerage fees. The 60-day advance payment requirement is crucial for franchisees to consider, as it impacts the timing of the sale and the franchisee's financial planning.
It is important to note that this fee is non-refundable, regardless of whether the transfer is ultimately approved. This highlights the importance of careful planning and due diligence before initiating the transfer process. Franchisees should also be aware that Holiday will evaluate the prospective new owner based on then-current procedures and criteria, including credit, operational abilities, market feasibility, and prior business dealings. This evaluation adds another layer to the transfer process, ensuring that the new owner is capable of maintaining the standards of the Crowne Plaza brand.
In summary, the $25,000 processing fee and the 60-day advance payment requirement are significant factors for any Crowne Plaza franchisee considering a transfer. These conditions underscore the franchisor's control over the transfer process and the financial implications for the franchisee.