What actions trigger the lender's obligation to notify the Embassy Suites Franchisor?
Embassy_Suites Franchise · 2025 FDDAnswer from 2025 FDD Document
- Notice to Franchisor. Lender agrees to notify Franchisor (a) contemporaneously with the commencement of any action that may result in an Acquisition; (b) contemporaneously with the filing of a petition for appointment of a receiver or any other action initiated by Lender that materially impacts possession of the Hotel; (c) promptly after an Acquisition of the date the Acquisition occurred, or (d) promptly after Lender no longer has a security interest in the equity ownership of Franchisee or the Loan is paid in full, but Lender's failure to give notice under this Subparagraph 3(d) will not affect the automatic termination of this letter agreement under Paragraph 11 [NO ESTOPPEL] 12 [ESTOPPEL]. Lender further agrees to promptly provide to Franchisor a copy of any order appointing a receiver or any other judicial or administrative order from an action initiated by Lender that materially impacts possession of the Hotel. All notices to Franchisor should be sent to the following address or such other address periodically designated by Franchisor in writing:
Hilton Worldwide Holdings Inc. Attention: General Counsel 7930 Jones Branch Drive, Suite 1100 McLean, VA 22102
If Lender wishes to send a notice to Franchisor regarding securitizations, Lender may send the notice by any method described above, or by email (with read receipt confirmation) at Lender.Comfort.Letters@hilton.com or such other email address as Franchisor may periodically designate by notice to Lender.
Source: Item 23 — RECEIPTS (FDD pages 97–305)
What This Means (2025 FDD)
According to Embassy Suites' 2025 Franchise Disclosure Document, a lender is obligated to notify the franchisor under specific circumstances related to actions that may impact the ownership or control of the hotel.
The lender must notify Embassy Suites contemporaneously with the commencement of any action that may result in an Acquisition. An Acquisition refers to the lender acquiring possession and/or ownership of the hotel due to the franchisee's default, especially concerning physical standards or other non-monetary defaults. The lender must also notify Embassy Suites contemporaneously with the filing of a petition for the appointment of a receiver or any other action initiated by the lender that materially impacts the possession of the hotel.
Furthermore, the lender is required to notify Embassy Suites promptly after an Acquisition, specifying the date the Acquisition occurred. Additionally, the lender must notify Embassy Suites promptly after the lender no longer has a security interest in the equity ownership of the Franchisee or the loan is paid in full. However, failure to provide this last notice does not affect the automatic termination of the letter agreement. The lender must also promptly provide Embassy Suites with a copy of any order appointing a receiver or any other judicial or administrative order from an action initiated by the lender that materially impacts possession of the Hotel.
All notices to Embassy Suites should be sent to the address specified in the FDD or any other address periodically designated by Embassy Suites in writing. If the lender wishes to send a notice to Embassy Suites regarding securitizations, the lender may send the notice by mail or by email with read receipt confirmation to the email address provided in the FDD.