Under what circumstances can the Even Hotels agreement be terminated immediately by either party?
Even_Hotels Franchise · 2025 FDDAnswer from 2025 FDD Document
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- Termination & Change of Control. In the event of a termination or expiration of the License Agreement, SCH may elect to terminate this Agreement immediately upon written notice to Client. In the event of a "Change of Control" (defined as a change in total or complete ownership of the Hotel and/or in an event when new partial or majority ownership of the Hotel , whether by merger, investment, or acquisition, results in involvement of another party to the License Agreement that places SCH in a disadvantage if the existing terms of this Agreement are maintained), SCH may elect to terminate this Agreement immediately upon written notice to Client. In the event of such termination by SCH only Sections 2, 3, 4, 7, 8, 9, 10, 11, 13, 14 and 18 herein shall survive such termination.
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- If Client is participating with a third party intermediary (TPI) that is not certified by SCH, even if Client has obtained a waiver to participate with said non-certified TPI, this agreement shall be terminated upon notice to Client.
8.3 Termination for Hotel Bankruptcy Event. IHG may terminate this Agreement, in whole or in part, immediately upon written notice to Hotel upon a Hotel Bankruptcy Event.
8.4 Termination for Hotel Bankruptcy Event. HotelKey or IHG may terminate this Agreement, in whole or in part, immediately upon written notice to Hotel of a Hotel Bankruptcy Event.
Source: Item 23 — RECEIPTS (FDD pages 99–438)
What This Means (2025 FDD)
According to Even Hotels' 2025 Franchise Disclosure Document, there are specific instances that allow for immediate termination of agreements.
In the context of a service agreement, SCH (presumably a service provider) may terminate the agreement immediately upon written notice to the client if the License Agreement is terminated or expires, or in the event of a "Change of Control" which places SCH at a disadvantage if the existing terms are maintained. Additionally, if a client is using a third-party intermediary (TPI) not certified by SCH, the agreement can be terminated immediately upon notice, even if a waiver was previously granted.
For a payment solution agreement, IHG may terminate the agreement immediately upon written notice to the hotel in the event of a Hotel Bankruptcy Event. Similarly, HotelKey or IHG can terminate their agreement immediately with written notice to the Hotel if a Hotel Bankruptcy Event occurs.
It is important for a prospective Even Hotels franchisee to understand these termination conditions, as they can significantly impact the operation and financial obligations of the franchise. Franchisees should seek clarification from Even Hotels regarding the definitions and implications of these termination clauses to fully assess the risks and responsibilities associated with the franchise agreement.