Are the initial fees for an Atwell Suites franchise refundable, and if so, under what conditions?
Atwell_Suites Franchise · 2025 FDDAnswer from 2025 FDD Document
o bankruptcy is required to be disclosed in this Item.
ITEM 5 INITIAL FEES
All initial fees are payable in full prior to your Hotel opening, are fully earned when received, and are not refundable, except as stated otherwise below. The initial fees described in this Item 5 reflect the current standard initial fees and while usually applied uniformly, Holiday may elect to reduce a fee after considering criteria, including but not limited to, the number of Hotels in the Brand System operated by a licensee or the market position of the Hotel. In limited circumstances, Holiday may negotiate or waive some of the initial fees described herein but Holiday is not obligated to do so.
APPLICATION FEE:
When you submit an application for an Atwell Suites® License – whether for a new development, conversion, change of ownership or re-licensing – you must pay Holiday an initial application fee (the "Application Fee") of $500 per guest suite, but not less than $50,000.
See Item 6 for information relating to the requirements and fees for changes of ownership, licensee name changes, realignment of the licensee's ownership and re-licensing.
If Holiday does not approve your application for a License, or if you withdraw the application before Holiday approves or denies it, Holiday will return the Application Fee to you, less $15,000 to cover costs for evaluating your application. If Holiday approves the application subject to certain requirements, Holiday may revoke its approval if you fail to meet those requirements. Once Holiday approves the application (even if Holiday subsequently revokes its approval), the Application Fee is nonrefundable. If you and Holiday agree to add any guest rooms to the Hotel, then you must pay to Holiday a nonrefundable Room Addition Fee of $500 for each new approved guest room.
PROPERTY IMPROVEMENT PLAN "PIP":
Before you submit an application for a conversion, change of ownership, brand change or re-licensing, you must arrange for Holiday to conduct an inspection of the Hotel so that Holiday can prepare a PIP for the upgrading, construction and furnishing of the Hotel in accordance with the then-current Standards. There is a nonrefundable $10,000 fee for the inspection of your Hotel and the preparation of the PIP (see also Item 6) due at the time the PIP is prepared. In the case of a conversion Hotel, Holiday will not authorize your Hotel to open until you complete all PIP requirements, including submission of plans before the start of construction in accordance with the dates specified in your License and Attachment "B" of your License (see Item 11). In the event the Hotel fails its opening
inspection or if an extension of the PIP milestone dates is required, Holiday may charge you up to $5,000, plus expenses, for each extension, re-evaluation and re-inspection (see also Item 7, Note 10).
PRE-OPENING SUPPORT:
The Openings program provides services and training required to open a Hotel in the Brand System, including Key Programs Training, pre- and post-opening support and other pre-opening consultations.
Source: Item 5 — INITIAL FEES (FDD pages 27–30)
What This Means (2025 FDD)
According to Atwell Suites' 2025 Franchise Disclosure Document, initial fees are generally non-refundable, but there are exceptions regarding the application fee. All initial fees are payable in full prior to the hotel opening and are considered fully earned upon receipt. However, the application fee, which is $500 per guest suite (with a minimum of $50,000), is refundable under specific conditions.
If Atwell Suites does not approve the application for a license, or if the applicant withdraws the application before approval or denial, the application fee will be returned, less $15,000 to cover the costs of evaluating the application. This means that even if the application is not approved, Atwell Suites retains $15,000. Once Atwell Suites approves the application, the application fee becomes nonrefundable, even if Atwell Suites subsequently revokes its approval. Additionally, a Room Addition Fee of $500 for each new approved guest room is nonrefundable once you and Atwell Suites agree to add guest rooms to the hotel.
Other fees, such as the $10,000 fee for the Property Improvement Plan (PIP) inspection, are explicitly nonrefundable. Similarly, unless specifically noted otherwise, all initial fees are payable before the hotel opens, are fully earned when paid, and are not refundable under any circumstances. This policy is fairly standard in the franchise industry, as these fees cover the franchisor's initial costs in evaluating and setting up a new franchisee.