How is the Start Date defined for Embassy Suites By Hilton's termination fee calculation?
Embassy_Suites_By_Hilton Franchise · 2025 FDDAnswer from 2025 FDD Document
than the Maintenance Fees charged to any similarly situated Customer (based upon factors determined by HSS in its sole judgment) utilizing equipment substantially similar to the Authorized Equipment and pursuant to an agreement which has terms and conditions substantially similar to this Agreement. No maintenance fees will be charged to Customer for any Non-maintained Equipment as described in Section 1 above.
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- Refresh of Authorized Equipment. Under HSS's refreshment program, Customer will be responsible for and will pay for all 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 Equi
Source: Item 22 — CONTRACTS (FDD page 97)
What This Means (2025 FDD)
According to the 2025 Embassy Suites By Hilton Franchise Disclosure Document, the Start Date for the purpose of calculating termination fees related to equipment maintenance is defined as the shipment date of the Authorized Equipment to the Customer's Hotel. This definition is relevant when the agreement is terminated before the third anniversary of this Start Date.
If the agreement is terminated (or if the Customer's use of the Preferred Provider is terminated) prior to the third anniversary of the Start Date, Embassy Suites By Hilton franchisees will be required to pay a termination fee. This fee is designed to reimburse the Preferred Provider and/or HSS (presumably a third-party vendor) for costs associated with the reconfiguration, start-up, and provision of maintenance services.
The termination fee structure varies depending on when the termination occurs relative to the Start Date. If termination occurs during the first year following the Start Date, the termination fee is $3,600. If termination occurs during the subsequent years, the termination fee will vary.