Is 'transfer' defined in the Embassy Suites HITS Agreement?

According to the 2025 Embassy Suites Franchise Disclosure Document, the term "transfer" is not explicitly defined in the HITS (Hotel Information Technology System) Agreement. However, Embassy Suites considers any attempt by the franchisee to transfer or assign any rights or obligations under the HITS Agreement as a "transfer" by the franchisee. This means that while there isn't a formal definition outlined in the agreement itself, any action that resembles a transfer will be treated as such by the franchisor.

This distinction is important for prospective Embassy Suites franchisees because it clarifies how the franchisor views attempts to shift responsibilities or benefits related to the technology systems covered by the HITS Agreement. Even without a precise definition, the franchisor maintains the right to interpret and treat such actions as transfers, which are subject to certain restrictions and may require franchisor approval. This gives Embassy Suites broad discretion over how the HITS Agreement is handled during ownership changes or other circumstances.

Furthermore, the FDD states that franchisees have no right to assign the HITS Agreement. However, in the event of a Change of Ownership transfer of the Franchise Agreement, Embassy Suites may permit the HITS Agreement to be assigned. This highlights the interconnectedness of the Franchise Agreement and the HITS Agreement, as a change in ownership of the franchise can potentially affect the HITS Agreement.

Therefore, franchisees need to seek explicit consent from Embassy Suites for any action that could be construed as a transfer of rights or obligations under the HITS Agreement. Understanding this interpretation is crucial for avoiding potential breaches of contract and maintaining a compliant franchise operation.