Lemon Tree Hotels Limited, through its material subsidiary Berggruen Hotels Private Limited (BHPL), has announced the termination of a Master Service Agreement dated May 23, 2010. The agreement, which pertained to the Keys Select Hotel Nestor by Lemon Tree, was cancelled due to the non-payment of outstanding management fees and deposit amounts by the counterparty. The company has confirmed that this development will have no significant financial impact on its operations.
Agreement Termination Details
Lemon Tree Hotels Limited has officially terminated the longstanding Master Service Agreement regarding the hotel property operating under the brand name “Keys Select Hotel Nestor by Lemon Tree.” This action was initiated by BHPL, a material subsidiary of the company, following a failure to meet financial obligations stipulated in the original contract.
Reasons for Termination
The decision to end the agreement stems from the consistent non-payment of outstanding Management Fees and the required deposit amounts as defined in the agreement terms. The partnership, which originally commenced on May 23, 2010, was effectively dissolved by the company to safeguard its interests against further financial arrears.
Financial Outlook
Despite the cessation of this management agreement, the management of Lemon Tree Hotels Limited has stated that the termination will not result in any significant financial impact on the company. The organization remains focused on its operational efficiency and ongoing brand expansion initiatives across its broader portfolio of properties.
Source: BSE
