Under what circumstances might Holiday reject a proposed management company for a Crowne Plaza franchise?
Crowne_Plaza Franchise · 2025 FDDAnswer from 2025 FDD Document
Holiday may reject a proposed management company if Holiday determines that it is inexperienced in the hospitality business, generally unqualified to operate the Hotel or unwilling or unable to: (1) comply with all requirements of Holiday under the License and the Standards, (2) cease operating the Hotel as a Holiday licensed Hotel once the License terminates or (3) treat the terms of the License as superior over any conflicting terms in the agreement between you and your management company.
Even though any management company must be acceptable to Holiday, you remain solely responsible for the selection, conduct and performance of any required management company, General Manager and all staff members and employees and Holiday has no responsibilities or liability in connection with your selection and its, his or her conduct or performance.
Holiday requires that any management agreement between you and a management company be in writing, and that the agreement contain certain provisions, including without limitation the following: the management company agrees to abide by all rules, regulations, inspections and requirements of Holiday; you and the management company must cease operating the Hotel as a Brand System brand Hotel if the License terminates; you and the management company must agree that the License prevails over the terms of the management agreement if there is any conflict in terms; you and the management company agree that Holiday's consent to the management agreement or approval of the management company does not relieve you or any guarantor of any obligations under the License; and, you and the management company will keep the confidentiality of trade secrets described in Item 14, and follow the in-term covenant not to compete described in Item 17. Holiday may request at any time a copy of your management agreement for review to determine compliance with requirements of the License.
Source: Item 15 — Obligation to Participate in the Actual Operation of the Franchise Business (FDD pages 85–87)
What This Means (2025 FDD)
According to Crowne Plaza's 2025 Franchise Disclosure Document, Holiday, the entity that franchises Crowne Plaza hotels, has the right to reject a proposed management company under specific circumstances. If Holiday requires a franchisee to hire a management company, it may reject a proposed company if it determines the company is inexperienced in the hospitality business or generally unqualified to operate the hotel. This ensures that the management company has the necessary expertise to maintain Crowne Plaza's standards.
Holiday can also reject a management company if it is unwilling or unable to comply with Holiday's requirements under the License and the Standards. This includes adhering to all the rules and regulations set forth by Holiday. Additionally, Holiday may reject a company that is unwilling to cease operating the hotel as a Holiday licensed hotel once the License terminates, ensuring a clean break if the franchise agreement ends. Another reason for rejection is if the management company is unwilling to treat the terms of the License as superior over any conflicting terms in the agreement between the franchisee and the management company, ensuring Holiday's standards are prioritized.
Even if a management company is approved by Holiday, the franchisee remains solely responsible for the selection, conduct, and performance of the management company, General Manager, and all staff members and employees. Holiday has no responsibilities or liability in connection with the franchisee's selection and its, his or her conduct or performance. This means that while Holiday has approval power, the onus is on the franchisee to ensure the management company is competent and meets expectations. Holiday also requires that any management agreement between the franchisee and a management company be in writing and contain certain provisions, including that the management company agrees to abide by all rules, regulations, inspections, and requirements of Holiday.