Under what circumstances does an Atwell Suites franchisee have to pay an Audit/Interest fee, and what does this fee include?

According to Atwell Suites' 2025 Franchise Disclosure Document, an Audit/Interest fee may be charged to franchisees under specific circumstances related to audits and payment deficiencies. If an audit conducted by Holiday (presumably referring to the franchisor or an affiliated entity) reveals a payment deficiency that is not offset by any overpayment, the franchisee is required to pay the amount of the deficiency immediately. In addition to covering the deficiency, Atwell Suites will also charge an audit fee of $3,000. However, if the audit does not find any deficiency, the franchisee will not be charged the audit fee.

Furthermore, the FDD states that any amounts not paid when due will accrue interest. This interest begins accruing on the first day of the month following the due date. The interest rate is set at 1.5% per month or the maximum interest rate permitted by law, whichever is lower. This provision ensures that Atwell Suites franchisees are incentivized to make timely and accurate payments to avoid additional fees and interest charges.

For a prospective Atwell Suites franchisee, this means maintaining accurate financial records and ensuring timely payments to the franchisor. Failure to do so could result in an audit, the cost of the deficiency, a $3,000 audit fee, and accruing interest on the unpaid amount. It is important to note that the audit fee is only charged if a deficiency is found, providing some assurance that franchisees are not penalized for minor discrepancies or errors that do not result in underpayment.