Under the Shared Facilities Addendum, what is Embassy Suites By Hilton consenting to?
Embassy_Suites_By_Hilton Franchise · 2025 FDDAnswer from 2025 FDD Document
For good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, you and we agree that the following provisions are incorporated into and made a part of the Agreement:
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- We give our consent for the Hotel and the [Hotel #2] Hotel to jointly utilize the Shared Facilities identified during our review and approval of the Plans and Designs for the Hotel and the [Hotel #2] Hotel.
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- Our consent is contingent upon you (or your Affiliate) executing a Shared Facilities Addendum to the **[Hotel #2]**Agreement on the same terms contained in this Addendum.
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- We expressly reserve the right to withdraw our consent and, on notice, require you to discontinue the Shared Facilities Arrangement if:
- a) we determine that such participation is detrimental to the operation of the Hotel, the guest experience, or the goodwill and reputation of the Brand and/or the Marks;
- b) any of the Shared Facilities fail to meet System Standards as set forth under the Agreement and/or the [Hotel #2] Agreement;
- c) either the Agreement or the [Hotel #2] Agreement is terminated for any reason;
- d) You Transfer a controlling Equity Interest in you, the Hotel Site, or the Agreement, without simultaneously selling, leasing, assigning, or Transferring a controlling Equity Interest in you (or your Affiliate controlling [Hotel #2] Hotel), the [Hotel #2] Hotel Site, or the [Hotel #2] Agreement, to the same transferee or a transferee under common control with such transferee. Any Transfers are subject to the Transfer provisions of the Agreement. Failure to comply with the Transfer provisions is a material breach of the Agreement.
If we withdraw our consent pursuant to this paragraph, to the extent that the Shared Facilities are part of Standards, you shall immediately make arrangements to either procure the Shared Facilities, or to construct comparable facilities and amenities, for the exclusive use of the Hotel.
Your failure to procure the Shared Facilities or construct comparable facilities and amenities to meet Standards is deemed to be a default that may result in the termination of the Agreement.
Source: Item 22 — CONTRACTS (FDD page 97)
What This Means (2025 FDD)
According to the 2025 Embassy Suites By Hilton Franchise Disclosure Document, the Shared Facilities Addendum outlines the brand's consent for the hotel and another hotel (referred to as Hotel #2) to jointly utilize shared facilities. This consent is specifically for the shared facilities identified during the review and approval of the plans and designs for both hotels. This arrangement allows for the potential sharing of resources and amenities between the two hotel properties.
However, Embassy Suites By Hilton's consent is contingent upon the franchisee (or their affiliate) executing a Shared Facilities Addendum to the agreement with Hotel #2, ensuring that the terms are consistent across both agreements. Embassy Suites By Hilton retains the right to withdraw its consent if the shared facilities arrangement is deemed detrimental to the operation of the hotel, the guest experience, or the brand's reputation. This also applies if the shared facilities fail to meet the system standards outlined in the franchise agreement or the agreement with Hotel #2.
Embassy Suites By Hilton may also withdraw consent if either of the agreements is terminated or if there is a transfer of controlling equity interest without a corresponding transfer in the other hotel. If consent is withdrawn, the franchisee is obligated to either procure the shared facilities independently or construct comparable facilities for the exclusive use of the Embassy Suites By Hilton hotel. Failure to comply with these requirements may result in a default and potential termination of the franchise agreement. This ensures that the Embassy Suites By Hilton maintains its standards and guest experience even if the shared facilities arrangement is discontinued.