Under what conditions can Embassy Suites By Hilton refuse a transfer of ownership of a franchise?

According to the 2025 Embassy Suites By Hilton Franchise Disclosure Document, Embassy Suites By Hilton can refuse a transfer of ownership of a franchise for good cause. Good cause includes several specific conditions related to the proposed transferee's qualifications, competitive status, willingness to comply with obligations, and financial standing.

Embassy Suites By Hilton may refuse a transfer if the proposed transferee does not meet the brand's current reasonable qualifications or standards. This ensures that new owners maintain the operational and quality standards expected of an Embassy Suites By Hilton franchise. Additionally, if the proposed transferee is a competitor of Embassy Suites By Hilton, the transfer can be denied to protect the brand's market position and competitive advantage. The brand can also refuse the transfer if the proposed transferee is unwilling to agree in writing to comply with all lawful obligations, ensuring adherence to the franchise agreement and operational standards.

Furthermore, Embassy Suites By Hilton can refuse a transfer if the franchisee or proposed transferee has not paid all sums owing to the franchisor or has failed to cure any default in the Franchise Agreement existing at the time of the proposed transfer. This protects the franchisor's financial interests and ensures that existing obligations are met before a transfer is approved. However, this does not prevent Embassy Suites By Hilton from exercising a right of first refusal to purchase the franchise.

These conditions provide Embassy Suites By Hilton with the necessary safeguards to maintain brand standards, protect its competitive position, and ensure financial stability when considering a transfer of ownership. Prospective franchisees should be aware of these conditions and ensure that any potential transferees meet these requirements to facilitate a smooth transfer process.