Disclosure under Regulation 30 of SEBI (LODR) Regulations, 2015- Termination of Master Service Agreement by Berggruen Hotels Private Limited (material subsidiary of the Company)
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Lemon Tree Hotels' material subsidiary Berggruen Hotels Private Limited (BHPL) has terminated its Master Service Agreement with three entities - CS Hospitality & Management Services, Green Apple Hotels & Resorts, and Nestor Hotels Private Limited. The agreement dated May 23, 2010, related to the hotel operated under the brand 'Keys Select Hotel Nestor by Lemon Tree'. The termination was initiated due to non-payment of outstanding Management Fee and deposit amounts by the counterparties. The company has clarified that there is no significant financial impact on Lemon Tree Hotels arising from this termination.
The termination is unlikely to materially affect Lemon Tree Hotels' financials as the company explicitly stated no significant financial impact. However, it signals credit risk issues with one of its managed properties and may lead to operational disruptions for that specific hotel.