What is the purpose of submitting a Change of Ownership Application to Embassy Suites?
Embassy_Suites Franchise · 2025 FDDAnswer from 2025 FDD Document
- "Change of Ownership Application" means the application that is submitted to us by you or the Transferee for a new franchise agreement in connection with a Change of Ownership Transfer.
- "Change of Ownership Transfer" means any proposed Transfer that results in a change of Control of Franchisee, the Hotel, or the Hotel Site and is not otherwise permitted by this Agreement, all as set out in Subsection 12.2.2.
12.2.2 Change of Ownership Transfer. A Change of Ownership Transfer is any Transfer that will result in a change of Control of you, the Hotel or the Hotel Site, or is not otherwise described in Subsection 12.2.1. We will have sixty (60) days from our receipt of the completed and signed franchise application to consent or withhold our consent to any proposed Change of Ownership Transfer. Our consent will not be unreasonably withheld. You consent to our communication with any third party we deem necessary about the Hotel in order for us to evaluate the proposed Change of Ownership Transfer. Our consent to the Change of Ownership Transfer is subject to the following conditions, all of which must be satisfied at or before the date of closing the Change of Ownership Transfer ("Closing"):
12.2.2.1 Transferee submits a completed and signed Change of Ownership Application, pays our then-current franchise application fee, executes our then-current form of franchise agreement, and all required ancillary documents. If all conditions to our consent are fulfilled, the date of Closing will be the termination date of this Agreement, and the effective date of Transferee's franchise agreement;
12.2.2.6 Transferee meets our then-current business requirements for new
franchisees; and
Source: Item 22 — CONTRACTS (FDD page 97)
What This Means (2025 FDD)
According to Embassy Suites's 2025 Franchise Disclosure Document, a Change of Ownership Application is required when there is a transfer that results in a change of control of the franchisee, the hotel, or the hotel site. This application is submitted to Embassy Suites by the current franchisee or the prospective new franchisee when seeking a new franchise agreement related to such a transfer. Embassy Suites has 60 days from receiving the completed application to either approve or deny the proposed transfer.
Embassy Suites will assess several factors when reviewing the Change of Ownership Application. These include ensuring the new franchisee meets the brand's current business requirements, that all outstanding fees and obligations are settled, and that the transfer does not pose any legal or financial risks to Embassy Suites. The brand also requires the transferee to execute the then-current form of the franchise agreement and all required ancillary documents.
For a prospective Embassy Suites franchisee, understanding the requirements for a Change of Ownership Transfer is crucial. It ensures a smooth transition and avoids potential delays or rejection of the transfer. The franchisee should be prepared to provide all necessary information, pay applicable fees, and meet Embassy Suites's standards for new franchisees. Additionally, the franchisee should be aware of the potential for Embassy Suites to communicate with third parties regarding the hotel to evaluate the proposed transfer.