Under what conditions can IHG terminate the Even Hotels license, provided notice is given?
Even_Hotels Franchise · 2025 FDDAnswer from 2025 FDD Document
- (1) In accordance with notice from IHG to Licensee, this License will terminate (without any further notice unless required by law), provided that:
- (a) the notice is mailed at least 30 days (or longer, if required by law) in advance of the termination date;
- (b) the notice reasonably identifies one or more breaches of Licensee's obligations; and
- (c) the breach(es) are not fully remedied within the time period specified in the notice.
- (2) If Licensee shall have engaged in a violation of this License, for which a notice of termination was given and termination failed to take effect because the default was remedied during the then preceding 12 months, the period given to remedy defaults will, if and to the extent permitted by applicable law, thereafter be 10 days instead of 30 (provided, however, if there have been two or more violations of this License in the preceding twelve months for which notices of termination were given, upon the next violation, if and to the extent permitted by applicable law, this License may be terminated by IHG immediately upon notice).
- (3) In any judicial proceeding in which the validity of termination is at issue, IHG will not be limited to the reasons set forth in any notice sent under this paragraph.
- (4) If Licensee fails to cure its breach of its obligations timely and in the manner required by IHG, IHG may in its sole discretion suspend the Hotel from access to the Brand System. IHG may also in its sole discretion remove the Hotel's listing from any website services and divert reservations previously made for the Hotel to other Brand System Hotels or IHG Portfolio Brand Hotels. Licensee must pay all costs arising from suspension from the Brand System. IHG's election to suspend the Hotel from said access rather than terminate this License will not: (i) constitute a waiver of any breach by Licensee or of any rights
Source: Item 23 — RECEIPTS (FDD pages 99–438)
What This Means (2025 FDD)
According to Even Hotels' 2025 Franchise Disclosure Document, IHG can terminate the license agreement with advance notice under specific conditions. IHG must mail a notice to the franchisee at least 30 days in advance of the termination date, unless the law requires a longer period. This notice must clearly identify one or more breaches of the franchisee's obligations under the license agreement. The franchisee then has a specified time period to fully remedy these breaches. If the franchisee successfully fixes the issues within the given timeframe, the termination will not occur.
However, the terms change if the Even Hotels franchisee has previously violated the license agreement, resulting in a termination notice, but managed to correct the default within the preceding 12 months. In such cases, the period allowed to remedy future defaults may be reduced to 10 days, if permitted by law. Furthermore, if there have been two or more violations in the preceding 12 months for which termination notices were given, IHG may terminate the license immediately upon notice for any subsequent violation, again, if permitted by applicable law.
Even Hotels franchisees should be aware that IHG retains significant discretion in these matters. In any legal proceedings regarding the validity of a termination, IHG is not limited to the reasons initially stated in the termination notice. Additionally, if a franchisee fails to adequately address a breach, IHG can suspend the hotel's access to the Brand System, remove its listing from websites, and redirect reservations to other hotels within the Brand System. The franchisee is responsible for all costs associated with such a suspension. It is important to note that IHG's decision to suspend access rather than terminate the license does not constitute a waiver of any breach or rights to terminate, nor does it entitle the franchisee to any compensation for losses resulting from the suspension.