What is the purpose of the restricted cash held by Best Western, and when does Best Western gain access to these funds?
Best_Western Franchise · 2025 FDDAnswer from 2025 FDD Document
The Best Western Board of Directors ("Board") will not consider the Application until such time as Best Western has received the required affiliation fee ("Affiliation Fee"), which will be held by Best Western as a good-faith deposit until such time and in such manner as further described in this Application.
Source: Item 23 — Receipts (FDD pages 108–413)
What This Means (2025 FDD)
According to Best Western's 2025 Franchise Disclosure Document, Best Western requires payment of an affiliation fee from applicants, which is held as a good-faith deposit. The document states that the Best Western Board of Directors will hold the affiliation fee until a later time and manner as described in the application.
This implies that the affiliation fee serves as a security or assurance of the applicant's serious intent to join the Best Western brand. It is not immediately accessible to Best Western upon payment. Instead, it is held in escrow or a similar arrangement until certain conditions are met.
For a prospective franchisee, this means that a portion of their initial investment is not immediately available for Best Western's use but is held as a deposit. The specific conditions under which Best Western gains access to these funds are further detailed in the application, which a potential franchisee should carefully review to understand the requirements and circumstances for the release of the affiliation fee.