For Atwell Suites, when does the lease commence for each piece of dispensing equipment?

According to Atwell Suites' 2025 Franchise Disclosure Document, the lease for each piece of dispensing equipment commences on its installation date, referred to as the "Commencement Date." This applies to all beverage dispensers provided to the PSH Owner of each Corporate Hotel, who is termed the "Equipment Lessee." The equipment includes permanent merchandising, menu boards, refrigeration units, ice makers, and water filtration equipment installed by the company on the Equipment Lessee's premises, unless otherwise agreed in writing.

This arrangement means that franchisees will begin leasing the dispensing equipment as soon as it is installed in their Atwell Suites hotel. The lease terms continue until the equipment is removed from the premises, even if any other agreements expire or are terminated. If the lease is terminated before 100 months from the Commencement Date due to reasons other than the company removing the equipment without cause, the Equipment Lessee is responsible for covering the costs of removal, remanufacturing, installation, non-serialized parts, and other ancillary equipment.

The annual lease rate is calculated by multiplying the total installed cost of the equipment by the then-current lease factor, plus any applicable sales and use taxes. Rent is due monthly, and the company has the discretion to offset funds owed to the customer with amounts due under the lease. This financial aspect is crucial for franchisees to consider, as it directly impacts their operating costs and cash flow management.

In states where a lease without additional charges is not permitted, or if the customer chooses to lease additional dispensers, these dispensers will be leased at an annual rate determined by multiplying the total installed cost by the current lease factor, which is currently 0.24. If the lease factor changes during the term, any dispenser installed after the change will be subject to the new lease factor. It's important to note that the lease factor remains consistent even if the hotel's ownership or management changes. These charges will be invoiced, and any unpaid invoices will be subject to the company's payment/credit terms and conditions, potentially leading to a refusal to deliver further beverages until the invoice is settled.