Under what conditions can Embassy Suites assign the Franchise Agreement without franchisee consent?
Embassy_Suites Franchise · 2025 FDDAnswer from 2025 FDD Document
is strictly a7t y4ou r own risk. We will not be liable for any losses and/or da | m 2 a 0 g 2 es 5 in U co S nn e E cti M on B wi A th S the S u Y se S of U ou I r T we E b S site . | |---|---|
| Provision | Section in Franchise Agreement ("FA"), Spa Amendment and HITS Agreement | Summary |
|---|---|---|
| return all copies of the eforea spa Manual, cancel all assumed | ||
| name or equivalent registrations and transfer any domain name | ||
| listings and registrations that contain any reference to the eforea | ||
| name to us, and cease representing yourself or the hotel as then | ||
| or formerly operating an eforea spa. | ||
| HITS Agreement 4.2 | You must stop using our software and related documents, return | |
| all copies to us, and certify to us that you have done so. |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 77–87)
What This Means (2025 FDD)
According to Embassy Suites' 2025 Franchise Disclosure Document, Embassy Suites has the right to assign or transfer the Franchise Agreement and its associated rights, duties, or assets to another party without obtaining the franchisee's consent. However, there is a condition attached to this right. The assignee must assume all of Embassy Suites' obligations to allow the franchisee to continue operating the hotel.
This provision means that a prospective Embassy Suites franchisee should be aware that the brand could be sold or transferred to a new owner who would then become their franchisor. While the franchisee's consent is not required for this transfer, the new franchisor must uphold the original terms of the Franchise Agreement, ensuring the franchisee can continue operating the hotel under the established conditions.
This is a fairly standard clause in franchise agreements, as it allows the franchisor flexibility in its business operations. However, it's crucial for franchisees to understand that the entity they initially contracted with may not be the entity they deal with throughout the entire term of the agreement. Franchisees should carefully review the 'Assignment of contract by us' section of the Franchise Agreement to fully understand their rights and obligations in such a scenario.