What happens to any interest earned on unused Monthly Program Fees for Embassy Suites?

According to the 2025 Embassy Suites Franchise Disclosure Document, any interest earned on unused Monthly Program Fees will be used by Embassy Suites before using the principal. This means that if the monthly program fees collected from franchisees generate interest while held by Embassy Suites, the interest income will be applied to cover program costs before dipping into the original fee contributions.

This policy benefits Embassy Suites as it allows them to maximize the funds available for system-wide programs and initiatives. It also provides a degree of transparency to franchisees, assuring them that any earnings generated from their fees will be put towards the intended purposes. However, franchisees do not directly benefit from the interest earned, as it is used to offset expenses rather than being returned to individual hotels or reducing future fees.

It's important to note that the FDD also states that the aggregate of Monthly Program Fees does not constitute a trust or advertising fund, and Embassy Suites is not a fiduciary with respect to these fees. This means that Embassy Suites has considerable discretion in how the fees are spent, as long as the interest is used before the principal. Prospective franchisees should carefully consider this aspect and ensure they are comfortable with the level of control Embassy Suites retains over these funds.