What constitutes a 'Change of Ownership Transfer' for an Embassy Suites By Hilton franchise?
Embassy_Suites_By_Hilton Franchise · 2025 FDDAnswer from 2025 FDD Document
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;
12.2.2.2 you are not in default of this Agreement or any other agreements with
us or our Affiliates;
Source: Item 22 — CONTRACTS (FDD page 97)
What This Means (2025 FDD)
According to Embassy Suites By Hilton's 2025 Franchise Disclosure Document, a 'Change of Ownership Transfer' refers to any transfer that results in a change of control of the franchisee, the hotel, or the hotel site. This definition excludes transfers that are otherwise permitted within the franchise agreement, as detailed in Subsection 12.2.2.
Embassy Suites By Hilton requires consent for any proposed Change of Ownership Transfer. The franchisor has 60 days from receiving a completed franchise application to either approve or deny the transfer. However, the franchisor's consent will not be unreasonably withheld, and they may communicate with third parties to evaluate the proposed transfer.
To obtain consent for a Change of Ownership Transfer, the prospective transferee must submit a completed application, pay the current franchise application fee, and execute the current form of the franchise agreement along with all required ancillary documents. Additionally, the franchisee must not be in default of the existing franchise agreement or any other agreements with Embassy Suites By Hilton or its affiliates. If all conditions are met, the closing date of the transfer will also be the termination date of the existing agreement and the effective date of the new franchisee's agreement.