When is the 'Initial Fee' applicable for a Baymont Inn Suites franchise?
Baymont_Inn_Suites Franchise · 2025 FDDAnswer from 2025 FDD Document
ectors, shareholders, employees, agents, and contractors, and the successors, assigns, personal representatives, heirs, and legatees of all such persons or entities.
Initial Fee means the fee you are to pay for signing this Agreement, as stated in Section 6, if the Agreement is for a new construction or conversion franchise.
Liquidated Damages means the amounts payable under Section 12, set by the parties because actual damages will be difficult or impossible to ascertain on the Effective Date and the amount is a reasonable pre-estimate of the damages that will be
Source: Item 22 — CONTRACTS (FDD pages 96–97)
What This Means (2025 FDD)
According to Baymont Inn Suites's 2025 Franchise Disclosure Document, the Initial Fee is applicable when signing a Franchise Agreement for a new construction or conversion franchise. This fee compensates Baymont Inn Suites for granting the franchise rights to the franchisee. In the event that a franchisee encounters unexpected issues during demolition, renovation, reconstruction, or refurbishment that render the Approved Plans commercially infeasible, the franchisee must notify Baymont Inn Suites immediately with a written report.
Baymont Inn Suites will evaluate the report and respond within 30 days regarding modifications to the Approved Plans. If no agreement is reached on modifying the plans and either party decides to terminate the agreement, the franchisee is still obligated to pay the full Initial Fee if it has not already been paid, and Baymont Inn Suites retains this fee.
However, if Baymont Inn Suites determines that continuing the project with the Approved Plans or any modification is not commercially feasible, then Liquidated Damages will not be owed. This clause protects the franchisee from additional penalties in situations where the project's failure is due to unforeseen circumstances deemed commercially unviable by Baymont Inn Suites itself.