Does the Hawthorn Suites By Wyndham definition of 'Equity Interests' include options?

According to Hawthorn Suites By Wyndham's 2025 Franchise Disclosure Document, the definition of 'Equity Interests' does include options. Specifically, the FDD states that 'Equity Interests' encompasses all forms of equity ownership, including voting stock interests, partnership interests, limited liability company membership or ownership interests, joint and tenancy interests, the proprietorship interest, trust beneficiary interests, and all options, warrants, and instruments convertible into such other equity interests. This broad definition is important for franchisees to understand, as it relates to potential transfers of ownership and the franchisor's approval rights.

This definition is relevant when considering an 'Equity Transfer,' which the FDD defines as any transaction that results in a change of control. This includes selling, assigning, transferring, or pledging any percentage of equity interests that leads to a change in control to persons not originally disclosed on Schedule B of the Franchise Agreement. The inclusion of options, warrants, and convertible instruments in the definition of 'Equity Interests' means that any transfer or transaction involving these items that could result in a change in control would be subject to the franchisor's approval.

For a prospective Hawthorn Suites By Wyndham franchisee, this means that any plans to issue options or warrants, or to transfer any form of equity ownership, must be carefully considered in light of the franchisor's approval rights. Failing to obtain the necessary approvals could result in a breach of the Franchise Agreement and potential termination. Therefore, it is crucial for franchisees to maintain open communication with Hawthorn Suites By Wyndham regarding any potential changes in ownership or equity structure.