Under what condition is the extension fee refundable for a Delta Hotels By Marriott franchise?
Delta_Hotels_By_Marriott Franchise · 2025 FDDAnswer from 2025 FDD Document
- (ii) If Franchisee wishes to further extend such deadlines following Franchisor's notice in the preceding paragraph, or if Franchisee wishes to extend the Opening Deadline after construction of the Hotel has commenced, Franchisee will make a written request giving the reasons for the delay. If the delay is caused by a Force Majeure Event (excluding, for the avoidance of doubt, unavailability of financing), Franchisor will equitably extend such deadlines. If the delay is not caused by a Force Majeure Event, Franchisor may, in its sole discretion, extend such deadlines and require Franchisee to pay its then-current extension fee. The extension fee is nonrefundable unless Franchisor declines to grant the requested extension. No extension under this Section 1.C.(ii) will be granted for more than six months.
Source: Item 23 — RECEIPTS (FDD pages 134–251)
What This Means (2025 FDD)
According to the 2025 Delta Hotels By Marriott Franchise Disclosure Document, an extension fee may be required to extend the construction start deadline or the opening deadline. If a franchisee requests an extension for reasons other than a Force Majeure Event, Delta Hotels By Marriott may, at its discretion, grant the extension and require the franchisee to pay an extension fee.
However, the FDD specifies that this extension fee is generally nonrefundable. The only circumstance under which the extension fee is refundable is if Delta Hotels By Marriott declines to grant the requested extension.
This condition is important for prospective franchisees to consider, as it means that the extension fee is at risk of being nonrefundable if the extension is granted. Franchisees should carefully assess their ability to meet the initial deadlines and the reasons for potentially needing an extension before paying the fee. This policy ensures that Delta Hotels By Marriott is compensated for considering the extension request, even if the extension is ultimately not needed by the franchisee.