What may Americas Best Value Inn do if a franchisee fails to pay amounts when due?
Americas_Best_Value_Inn Franchise · 2025 FDDAnswer from 2025 FDD Document
If any payment under this Agreement or any other agreement between you and us is overdue for any reason you will pay to us on demand a late charge equal to the lesser of (a) 1.5% of the overdue amount or (b) the maximum rate allowed by law.
If a greater amount than may be lawfully
collected is inadvertently collected, it will be applied to reduce outstanding amounts owed under this Agreement. You acknowledge and agree that if you fail to pay any amounts when due, we may report your delinquent payment to credit bureaus.
Source: Item 23 — RECEIPTS (FDD pages 71–223)
What This Means (2025 FDD)
According to the 2025 Americas Best Value Inn Franchise Disclosure Document, if a franchisee fails to pay amounts when due, Americas Best Value Inn has several options. Americas Best Value Inn can charge a late fee of 1.5% of the overdue amount or the maximum rate allowed by law, whichever is less. Additionally, Americas Best Value Inn may report the delinquent payment to credit bureaus.
Americas Best Value Inn can also consider the failure to pay as a default of the franchise agreement. If a franchisee fails to pay any amount due to Americas Best Value Inn, its affiliates, or any required third party under the agreement, it constitutes a default. This can lead to termination of the franchise agreement if the franchisee does not cure the default after receiving notice and an opportunity to correct the issue.
Furthermore, the franchisee's obligation to pay is absolute and unconditional, meaning they cannot withhold payments for any reason. The franchisee is also responsible for paying any taxes imposed on Americas Best Value Inn for the payments they make under the agreement, as well as all booking fees, reservation fees, and commissions related to the operation of their hotel.