What happens to an Even Hotels equipment lease if the Agreement is terminated?
Even_Hotels Franchise · 2025 FDDAnswer from 2025 FDD Document
If you have an equipment lease, termination of the Agreement does not terminate that equipment lease.
If you have rented equipment from us, termination of the Agreement does not relieve you of your obligation to make rental payments until the rented equipment is paid for in full or returned to us.
If this Lease is terminated with respect to any piece of Equipment for any reason, other than Company removing a piece of Equipment without cause under this section, prior to 100 months from the Commencement Date for that piece of Equipment, Equipment Lessee will pay Company the actual cost of removal (including standard shipping and handling charges) and remanufacturing of that Equipment, as well as the unamortized portion of the costs of (i) installation, (ii) non-serialized parts (e.g., pumps, racks and regulators) and other ancillary equipment.
Collectively, removal costs and items (i) and (ii) are referred to as "unbundling costs." The terms of this Lease will continue in effect with respect to each piece of Equipment until the Equipment has been removed from Equipment Lessee's premises and will survive the expiration or termination of any agreement into which this Lease is incorporated.
Source: Item 23 — RECEIPTS (FDD pages 99–438)
What This Means (2025 FDD)
According to Even Hotels' 2025 Franchise Disclosure Document, the termination of the franchise agreement does not automatically terminate any existing equipment lease. The franchisee remains obligated to fulfill the terms of the equipment lease, which includes continuing to make rental payments until the equipment is either fully paid for or returned to Even Hotels.
If the equipment is removed before 100 months from the installation date due to the agreement's termination (excluding instances where Even Hotels removes the equipment without cause), the franchisee, or Equipment Lessee, is responsible for covering the costs associated with the equipment's removal and remanufacturing. These costs encompass the actual expenses of removal, including shipping and handling, as well as the unamortized portion of the installation costs and any non-serialized parts or ancillary equipment. These combined expenses are referred to as "unbundling costs."
The terms of the lease remain in effect until the equipment is physically removed from the franchisee's premises, and these terms survive any expiration or termination of the overarching agreement into which the lease is incorporated. This means that even if the franchise agreement ends, the franchisee's obligations under the equipment lease continue until all equipment-related responsibilities are fulfilled.