What is the length of the 'Additional Period' granted to the lender to complete an Acquisition of an Embassy Suites franchise?
Embassy_Suites Franchise · 2025 FDDAnswer from 2025 FDD Document
If the default is for failure to comply with physical standards or other non-monetary default which could only be cured by Lender acquiring possession and/or ownership of the Hotel (each, an "Acquisition"), Lender may have an additional period of one hundred eighty (180) calendar days, commencing at the expiration of Lender's Cure Period, for Lender to complete its Acquisition, through foreclosure or other appropriate proceedings ("Additional Period"); provided that Lender must: (i) notify Franchisor no later than the date it commences proceedings (or promptly after action is stayed or enjoined) that Lender wants the Additional Period; (ii) commence proceedings and diligently prosecute such proceedings to completion; and (iii) comply with the obligations of Franchisee under the Franchise Agreement not being performed by Franchisee during the Additional Period including payment of all monetary obligations but excluding those obligations which can only be performed by Franchisee or which Lender cannot perform without possession and/or ownership of the Hotel.
On request by Lender, the Additional Period may be further extended by Franchisor in its determination, which determination shall take into consideration the period of time required to complete an Acquisition in the applicable jurisdiction, and any period of time in which Lender's action has been stayed or enjoined.
Source: Item 23 — RECEIPTS (FDD pages 97–305)
What This Means (2025 FDD)
According to Embassy Suites's 2025 Franchise Disclosure Document, a lender may be granted an 'Additional Period' to complete the acquisition of a hotel. This period is available if the franchisee defaults on obligations related to physical standards or other non-monetary issues that can only be resolved by the lender taking possession or ownership of the hotel.
The standard 'Additional Period' is one hundred eighty (180) calendar days, starting after the expiration of the lender's cure period. To qualify for this extension, the lender must notify Embassy Suites that they want the 'Additional Period' no later than when proceedings begin, or promptly after any action is stayed or enjoined. The lender must also commence proceedings and diligently pursue them to completion. Furthermore, the lender must fulfill the franchisee's obligations under the Franchise Agreement during this period, including all monetary obligations, except for those that only the franchisee can perform or those the lender cannot perform without possession or ownership of the hotel.
Embassy Suites may further extend the 'Additional Period' at the lender's request. This determination considers the time needed to complete an acquisition in the relevant jurisdiction and any time the lender's action has been stayed or legally blocked. This flexibility aims to accommodate the varying legal and procedural requirements across different locations, ensuring lenders have sufficient time to resolve defaults and maintain the operational standards of the Embassy Suites hotel.