Under what circumstances can HSS terminate the agreement with an Embassy Suites customer?
Embassy_Suites Franchise · 2025 FDDAnswer from 2025 FDD Document
HSS may terminate the above Equipment License on the Network Authorized Equipment and all other obligations of HSS under this TSP Agreement at HSS's option: (a) Immediately without notice in event of breach of Customer's obligations or conditions set forth in Sections 2 and 3 above, or (b) at any time, with or without cause, upon not less than ninety (90) days advance written notice to Customer.
Any default by Customer under this TSP Agreement will constitute a default by Customer under the HITS Agreement, and, in such event, HSS may exercise any of its rights provided under the HITS Agreement.
Any default by Customer under the HITS Agreement will constitute a default and breach of condition by Customer under this TSP Agreement.
Source: Item 23 — RECEIPTS (FDD pages 97–305)
What This Means (2025 FDD)
According to the 2025 Embassy Suites Franchise Disclosure Document, HSS (presumably a service provider) can terminate the Equipment License and all other obligations under the TSP Agreement immediately without notice if the customer breaches obligations or conditions detailed in Sections 2 and 3 of the agreement. Alternatively, HSS can terminate the agreement at any time, with or without cause, by providing the Embassy Suites customer with at least ninety (90) days advance written notice.
Additionally, HSS can terminate the agreement with written notice if the Embassy Suites customer fails to pay sums due under the agreement and does not cure the failure within a minimum of ten (10) days, breaches confidentiality obligations under Article 6, fails to refresh the Authorized Equipment at the hotel as required by HSS, or breaches any other provision of the agreement and does not cure the breach within a minimum of thirty (30) days.
The agreement will automatically terminate if the Relationship Agreement terminates or expires. Upon termination, the Embassy Suites customer's licenses are immediately terminated, and they must cease using all Agreement Products and Services, returning or destroying Agreement Products (excluding owned Authorized Equipment, but including all Software contained within). All obligations of the customer survive the termination or expiration of the agreement.
These termination conditions are typical in franchise agreements, as they protect the service providers and franchisors from financial loss and brand damage due to franchisee non-compliance. An Embassy Suites franchisee should carefully review the TSP Agreement and HITS Agreement to fully understand their obligations and the potential consequences of failing to meet them.