After an assumption, do the terms of the Embassy Suites By Hilton Franchise Agreement govern management?
Embassy_Suites_By_Hilton Franchise · 2025 FDDAnswer from 2025 FDD Document
After an Assumption, the terms of the Franchise Agreement will govern with respect to Management, provided, however, Lender shall not be bound by any requirements of the Franchise Agreement to manage the Hotel itself.
Source: Item 23 — RECEIPTS (FDD pages 97–304)
What This Means (2025 FDD)
According to the 2025 Embassy Suites By Hilton Franchise Disclosure Document, after an assumption, the terms of the Franchise Agreement will govern management of the hotel. However, the lender is not required to manage the hotel themselves, even if the Franchise Agreement stipulates such.
This means that once a lender assumes control of the Embassy Suites By Hilton hotel, the standard franchise agreement terms regarding hotel management will apply. This would include aspects like brand standards, operational procedures, and any specific management requirements outlined in the agreement.
However, there is a notable exception: the lender is not obligated to personally manage the hotel. This provides the lender with flexibility, allowing them to appoint a third-party management company or take other actions to ensure the hotel's smooth operation without being bound by requirements to manage the hotel themselves.