What is the non-refundable processing fee that an Embassy Suites franchisee must submit with offering documents when offering securities?
Embassy_Suites Franchise · 2025 FDDAnswer from 2025 FDD Document
nce to you, generally within thirty (30) days after the date of Closing;
12.2.2.4 you conclude to our satisfaction, or provide adequate security for, any suit, action, or proceeding pending or threatened against you, us or any of our Affiliates with respect to the Hotel, which may result in liability on the part of us or any of our Affiliates;
12.2.2.5 you, Transferee and/or Equity Owner(s) of Transferee, submit to us all information related to the Transfer that we require;
12.2.2.6 Transferee meets our then-current business requirements for new
franchisees; and
12.2.2.7 Transferee agrees to indemnify, hold harmless, and defend us and our Affiliates against any inquiry, investigation, suit, action, or proceeding arising out of or in connection with any fees or costs charged to patrons or guests by you.
12.3 Public Offering or Private Placement.
- 12.3.1 Any offering by you of Securities requires our review if you use the Marks, or refer to us or this Agreement in your offering. All materials required by any Law for the offer or sale of those Securities must be submitted to us for review at least sixty (60) days before the date you distribute those materials or file them with any governmental agency, including any materials
Source: Item 22 — CONTRACTS (FDD page 97)
What This Means (2025 FDD)
According to Embassy Suites's 2025 Franchise Disclosure Document, if a franchisee intends to offer securities and uses the Embassy Suites marks or refers to Embassy Suites or the franchise agreement in their offering documents, they must submit these documents to Embassy Suites for review at least 60 days before distribution or filing with any governmental agency.
This review process requires the franchisee to pay a non-refundable processing fee of $5,000 along with the submission of the offering documents. Additionally, the franchisee is responsible for covering any further costs that Embassy Suites incurs while reviewing these documents, including reasonable attorney's fees.
Embassy Suites retains the right to approve any description of the franchise agreement, the relationship between the franchisee and Embassy Suites, or any use of the Embassy Suites marks in any prospectus, offering memorandum, or other communication materials used in the sale or offer of securities. However, Embassy Suites's review of these documents does not imply agreement with any statements within them, including projections, or acknowledgment that the documents comply with any laws.