Under what conditions can IHG Tech terminate the MTSA for a Crowne Plaza franchise?
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. |
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, the MTSA (Multi-Tenant Service Agreement) may be terminated by IHG Tech for convenience. IHG Tech can terminate the MTSA by providing the Crowne Plaza licensee with 90 days' prior written notice. This means that IHG Tech has the right to end the agreement without needing to demonstrate any specific cause or breach of contract on the part of the franchisee.
This termination clause provides IHG Tech with significant flexibility, as it can decide to discontinue the MTSA for any reason it deems necessary, even if the franchisee is fully compliant with the agreement's terms. For a prospective Crowne Plaza franchisee, this implies a degree of uncertainty regarding the long-term stability of the services provided under the MTSA. While 90 days' notice is required, it may still present challenges for the franchisee to find alternative service providers and ensure a smooth transition.
Franchisees should carefully consider this termination provision and its potential impact on their business operations. It would be prudent to discuss with Crowne Plaza the typical reasons for such terminations and the potential costs associated with transitioning to a new service provider on short notice. Understanding the potential risks and having contingency plans in place can help mitigate the impact of an unexpected termination of the MTSA.