When are the Recurring Fees described in Sections 7.1.1 and 7.1.2 payable to Baymont Inn Suites?
Baymont_Inn_Suites Franchise · 2025 FDDAnswer from 2025 FDD Document
- 7.1 You will pay us certain "Recurring Fees" each month of the Term payable in U.S. dollars (or such other currency as we may direct if the Facility is outside the United States). The Recurring Fees described in Sections 7.1.1 and 7.1.2 are payable three days after the month in which they accrue, without billing or demand. Other Recurring Fees are payable at the times set forth in the Systems Standards. Fees include the following:
- 7.1.1 A "Royalty" equal to five percent (5%) of Gross Room Revenues of the Facility accruing during the calendar month, which accrues from the earlier of the Opening Date or the date you identify the Facility as a Chain Facility or operate it under a Mark until the end of the Term.
- 7.1.2 A "System Assessment Fee" as set forth in Schedule C, including a "Marketing Contribution" for advertising, marketing and training, and a "Basic Reservation Fee" for the Reservation System and other related services and programs, which accrues from the Opening Date until the end of the Term, including during reservation suspension period. We may use the System Assessment Fees we collect, in whole or in part, to reimburse our reasonable direct and indirect costs, overhead or other expenses of providing marketing, training and reservation services. We may earn a profit on activities supported by the System Assessment Fee. You will also pay or reimburse us as described in Schedule C for "Additional Fees" such as travel and other sales agent commissions paid for certain reservation and marketing services to generate reservations for the Facility plus a reasonable service charge, fees levied to pay for reservations for the Facility originated or processed through the Global Distribution System, the Chain Websites, and/or other reservation systems, distribution channels and networks, and fees for additional services and programs. We may charge Chain Facilities using the System outside the United States for reservation services using a different formula. We may change, modify, add, or delete the System Assessment Fee and/or Additional Fees in accordance with Schedule C.
Source: Item 23 — RECEIPTS (FDD pages 97–443)
What This Means (2025 FDD)
According to Baymont Inn Suites's 2025 Franchise Disclosure Document, Recurring Fees, specifically those detailed in Sections 7.1.1 and 7.1.2, are payable three days after the end of the month in which they accrue. This payment is due without Baymont Inn Suites needing to send a bill or demand payment. These fees must be paid in U.S. dollars, unless the facility is located outside the United States, in which case Baymont Inn Suites may direct payment in another currency.
Section 7.1.1 specifies that the "Royalty" fee, which is 5% of the Gross Room Revenues, accrues from the earlier of the Opening Date or the date the facility is identified as a Chain Facility or operates under a Mark, continuing until the end of the Term. Section 7.1.2 addresses the "System Assessment Fee," which includes a "Marketing Contribution" and a "Basic Reservation Fee," accruing from the Opening Date until the end of the Term, even during reservation suspension periods.
For a prospective franchisee, this means that they need to ensure they have sufficient cash flow to cover these recurring fees, as they are due shortly after the month's end. The fees cover ongoing royalties and system support, which are critical for maintaining the franchise agreement and utilizing Baymont Inn Suites's resources. Franchisees should carefully review Schedule C, as referenced in the FDD, for a complete understanding of how the System Assessment Fee and Additional Fees are calculated and may change.