Under what circumstances does Best Western charge liquidated damages for post-termination use of Best Western identifying marks?
Best_Western Franchise · 2025 FDDAnswer from 2025 FDD Document
| Liquidated Damages for Post Opening Premature Termination | The lesser of: (x) 36 months of Monthly Fees (calculated as your average Monthly Fees during the previous 12 months (but if Monthly Fees have been owed to us for less than 12 months, the average of all prior months) multiplied by 36); or (y) Monthly Fees for the remainder of the Extended Length Term or renewal term (calculated as your average Monthly Fees during the previous 12 months multiplied by the number of months remaining in the Extended Length Term or renewal term). | On demand. | Payable if you resign from the Membership or we terminate the Membership Agreement. |
|---|---|---|---|
| Liquidated Damages for Post Termination Use of Best Western Identifying Marks | 15% of the average of the Property's room rates per room per day multiplied by the total number of rooms. | On demand. | Payable for each day that any Best Western Identifying Mark is used in connection with the Property, after 15 days following resignation, cancellation or termination of the Membership Agreement. |
Source: Item 6 — Other Fees (FDD pages 24–37)
What This Means (2025 FDD)
According to Best Western's 2025 Franchise Disclosure Document, liquidated damages are charged for the post-termination use of Best Western identifying marks. Specifically, these damages are payable for each day that any Best Western Identifying Mark is used in connection with the property. This applies after a 15-day grace period following resignation, cancellation, or termination of the Membership Agreement.
The liquidated damages are calculated as 15% of the average of the property's room rates per room per day, multiplied by the total number of rooms. This formula is used to determine the amount Best Western charges if a property continues to use their identifying marks after the agreement has ended and the 15-day grace period has expired.
For a prospective franchisee, this means it is crucial to remove all Best Western signage and branding from the property within 15 days of the termination, cancellation, or resignation from the Best Western Membership Agreement to avoid incurring these daily liquidated damages. The amount could potentially be significant depending on the property's room rates and total number of rooms, so prompt compliance is essential.