What is the termination fee for Embassy Suites if the agreement is terminated after the third year?

According to Embassy Suites' 2025 Franchise Disclosure Document, the termination fee for the TSP Agreement depends on when the agreement is terminated. If the TSP Agreement is terminated after the third year following the shipment date of the Network Authorized Equipment to the Customer's Hotel, the termination fee is $1,200. This fee is designed to reimburse the Preferred Provider and/or HSS for uncovered costs, including Certified Third Party Software and costs incurred in the start-up and provision of maintenance services.

However, if the termination occurs after a Customer Refresh of Network Authorized Equipment, the termination fee is dependent on the period elapsed after the Start Date applicable to the shipment of such Authorized Equipment for each successive Customer Refresh. In this case, if termination occurs after the third year, the termination fee is also $1,200.

It's important to note that in addition to the termination fee, the customer may also be responsible for assuming any remaining lease payments for the Network Authorized Equipment or purchasing the equipment from HSS's lessor. Furthermore, the customer will be responsible for all subsequent fees and costs of Equipment Maintenance and Software Maintenance. If the termination occurs before the expiration of three years since HSS incurred installation and/or service fees in performing a refreshment of Network Authorized Equipment, the customer will also reimburse HSS for the unamortized value of such Refresh costs.