How does a Customer Refresh affect the Embassy Suites By Hilton termination fee?
Embassy_Suites_By_Hilton Franchise · 2025 FDDAnswer from 2025 FDD Document
ll fees and costs for the replacement or refreshment of the Authorized Equipment in HSS's sole discretion ("Refresh") on an approximate three (3) year cycle, starting approximately three (3) years after the initial shipment of such Authorized Equipment and for the provision of maintenance services by the Preferred Provider on such refreshed equipment. The terms and conditions of the Authorized Equipment maintenance services for such equipment (included in such initial Refresh and included in any additional Refresh or Refreshes of Customer's Authorized Equipment) will be the same as the terms and conditions of this Schedule B-2, including, but not limited to, the imposition of termination fees as described hereinafter, provided that the Maintenan
Source: Item 22 — CONTRACTS (FDD page 97)
What This Means (2025 FDD)
According to the 2025 Embassy Suites By Hilton Franchise Disclosure Document, a Customer Refresh of Authorized Equipment impacts the termination fee. If the agreement is terminated, or if the franchisee's use of the Preferred Provider is terminated, the termination fee will depend on the period elapsed after the start date applicable to the shipment of such authorized equipment for each successive Customer Refresh.
Without a Customer Refresh, if termination occurs during the first year following the start date, the termination fee is $3,600. If termination occurs during the second year, the fee is $2,600, and during the third year, it is $1,300. After the third year, the termination fee is $1,200.
However, after a Customer Refresh, the termination fees are different. If termination occurs during the first year after the start date applicable to the shipment of the refreshed equipment, the termination fee is $3,800. During the second year, it is $2,800, and during the third year, it is $1,400. After the third year following the Customer Refresh, the termination fee is $1,200. This means that a Customer Refresh essentially resets the termination fee schedule to a higher amount during the first three years following the refresh.