When is a 'Change of Ownership Application' required for a Surestay Hotel By Best Western franchise?
Surestay_Hotel_By_Best_Western Franchise · 2025 FDDAnswer from 2025 FDD Document
"Change of Ownership Application" means the application that is submitted to us by you or the Transferee for a new franchise agreement in connection with a Change of Ownership Transfer.
"Change of Ownership Transfer" means any proposed Transfer that results in a change of Control of Franchisee, the Hotel, or the Hotel Site and is not otherwise permitted by this Agreement, all as set out in Subsection 13.2.3.
13.2.3 Change of Ownership Transfer.
Any proposed Transfer that is not described in Subsection 13.2.1 or 13.2.2 is a Change of Ownership Transfer.
We will have sixty (60) days from our receipt of the completed and signed Change of Ownership Application (described below) to consent or withhold our consent to any 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"):
- 13.2.3.1 the Transferee submits a Change of Ownership Application, pays our then current Application Fee and Initial Franchise Fee, executes our then-current form of new franchise agreement and all ancillary forms, including a guaranty from a third party acceptable to us, if required;
- 13.2.3.2 you are not in default of this Agreement or any other agreements with us or our Affiliates;
- 13.2.3.3 you or the Transferee pay all amounts due to us and the Entities through the date of the Closing;
- 13.2.3.4 you execute our then-current form of voluntary termination agreement, which may include a general release, covering termination of this Agreement;
- 13.2.3.6 you, the Transferee and/or transferee Equity Owner(s) submit to us all information related to the Transfer that we require, including applications; and
- 13.2.3.7 the Transferee meets our then-current business requirements for new franchisees and is neither a Sanctioned Person nor a Competitor.
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.
Source: Item 23 — Receipts (FDD pages 88–286)
What This Means (2025 FDD)
According to Surestay Hotel By Best Western's 2025 Franchise Disclosure Document, a 'Change of Ownership Application' is required for any proposed transfer that results in a change of control of the franchisee, the hotel, or the hotel site, and is not otherwise permitted by the agreement. This is defined as a 'Change of Ownership Transfer'.
Specifically, any transfer that is not described in Subsection 13.2.1 (Transfers by Us) or 13.2.2 (Transfer On Death) is considered a Change of Ownership Transfer. The franchisor has 60 days from the receipt of the completed and signed Change of Ownership Application to either consent to or withhold consent for the proposed transfer.
To get consent for a Change of Ownership Transfer, the Transferee must submit a Change of Ownership Application, pay the current Application Fee and Initial Franchise Fee, execute the current form of new franchise agreement and all ancillary forms, including a guaranty from a third party acceptable to the franchisor, if required. The franchisee must not be in default of the agreement or any other agreements with the franchisor or its Affiliates, and all amounts due to the franchisor and the Entities must be paid through the date of the Closing. The franchisee must also execute the current form of voluntary termination agreement, which may include a general release, covering termination of the agreement.
Furthermore, the franchisee must resolve any pending or threatened legal actions related to the hotel to the franchisor's satisfaction, provide all required information related to the transfer, and ensure the Transferee meets the current business requirements for new franchisees, is not a Sanctioned Person, and is not a Competitor. The franchisor is also allowed to communicate with any third party deemed necessary to evaluate the proposed Change of Ownership Transfer.