Under what conditions can Delta Hotels By Marriott assign its contract without restriction?
Delta_Hotels_By_Marriott Franchise · 2025 FDDAnswer from 2025 FDD Document
| PROVISION | SECTION IN FRANCHISE OR OTHER AGREEMENT | SUMMARY1 | |
|---|---|---|---|
| i. | Franchisee's obligations on termination/non-renewal | Sections 19.4 and 20 | Obligations include complete de identification of hotel; delivery to us of any intellectual property and other materials relating to the operation of the hotel under the System, including all customer information, operating instructions, software and accompanying documentation and other materials provided by us; advising customers of the removal of the hotel from the System in accordance with the standards; compliance with the provisions of the franchise agreement that survive termination; and payment of all amounts due (including liquidated damages and actual damages if termination was due to your default as well as any fees associated with removing the hotel from the System). |
| j. | Assignment of contract by franchisor | Section 17.7 | No restriction on our right to assign if transferee is an affiliate of ours or has acquired substantially all of our rights to the System and agrees to assume our obligations to you under the franchise agreement and is capable of performing those obligations. |
Source: Item 16 — RESTRICTIONS ON WHAT THE FRANCHISEE MAY SELL (FDD pages 111–120)
What This Means (2025 FDD)
According to Delta Hotels By Marriott's 2025 Franchise Disclosure Document, Delta Hotels By Marriott has the ability to assign its franchise agreement under specific conditions without any restrictions. Delta Hotels By Marriott can freely assign the agreement if the transferee is an affiliate of theirs. Alternatively, they can assign the agreement if the transferee acquires substantially all of Delta Hotels By Marriott's rights to the Delta Hotels By Marriott system.
In either scenario, the transferee must agree to assume Delta Hotels By Marriott's obligations to the franchisee as outlined in the franchise agreement. Furthermore, the transferee must demonstrate the capability to fulfill these obligations. This provision ensures that if Delta Hotels By Marriott transfers the franchise agreement, the franchisee's rights and the franchisor's responsibilities will continue to be upheld by the new party.
This is a fairly standard clause in franchise agreements, allowing the franchisor flexibility in managing its business while providing some assurance to franchisees that their agreement will be honored even if ownership changes. Prospective franchisees should carefully consider this provision, understanding that the 'franchisor' they initially contract with may not be the entity they deal with throughout the entire term of the agreement.