What is the Royalty Fee for a Caption By Hyatt franchise based on?
Caption_By_Hyatt Franchise · 2025 FDDAnswer from 2025 FDD Document
- 6.2 Monthly Fees to Hyatt.
On or before the tenth (10th) day of each month or such later day of the month that Hyatt periodically specifies, Franchisee shall pay Hyatt:
(a) a "Royalty Fee" equal to the amount set forth in Exhibit B-1;
(b) the System Services Charges for the previous month.
Franchisee acknowledges that System Services Charges will include an allocable proportion of certain System Services Costs incurred during the period before the Hotel opens in accordance with this Agreement.
System Services Charges shall be determined on the same basis as such amounts are determined for other Participating Hotels.
Any allocation of shared costs that the Hyatt Group makes in good faith and with the intention of fairly allocating such costs to System Services shall be binding on the parties hereto.
System Services Costs shall include the actual costs incurred by the Hyatt Group and shall not be subject to any mark-up, premium or profit on any Mandatory Services, but may include a profit or markup component on Non-Mandatory Services as described above or as determined by the Hyatt Group.
The Hyatt Group may in its reasonable judgment periodically change its method of allocation of the System Services Costs among Participating Hotels, and the categories of Brand Hotels and/or other Hyatt Network Hotels that are classified as Participating Hotels, provided that such method of allocation and categories of Participating Hotels shall at all times be determined on a reasonable, equitable and nondiscriminatory basis; and
- (c) all fees and other amounts that Hyatt (or its Affiliates) then has paid or has agreed to pay on Franchisee's behalf to any Providers.
If any Provider assesses a single or group fee or other charge that covers all or a group of Brand Hotels or other Hyatt Network Hotels to which that Provider provides products or services, Franchisee agrees that Hyatt's allocation of that fee or other charge among the Hotel and other participating hotels is final.
Source: Item 22 — Contracts (FDD page 85)
What This Means (2025 FDD)
According to the 2025 Caption By Hyatt Franchise Disclosure Document, the Royalty Fee is determined by the amount set forth in Exhibit B-1. Franchisees are required to pay this Royalty Fee to Caption By Hyatt on or before the tenth day of each month, or any later date that Caption By Hyatt specifies.
In addition to the Royalty Fee, franchisees must also pay System Services Charges for the previous month. These charges may include an allocable proportion of certain System Services Costs incurred before the hotel even opens, aligning with the franchise agreement. Caption By Hyatt determines System Services Charges on the same basis as they are for other Participating Hotels.
The Hyatt Group has the discretion to modify the allocation method of System Services Costs among Participating Hotels, as well as the categories of Brand Hotels and other Hyatt Network Hotels classified as Participating Hotels. However, these changes must be reasonable, equitable, and non-discriminatory. Franchisees are also responsible for all fees and other amounts that Caption By Hyatt or its affiliates have paid or agreed to pay on the franchisee's behalf to any Providers. If a Provider assesses a single or group fee covering multiple Brand Hotels or Hyatt Network Hotels, Caption By Hyatt's allocation of that fee among the participating hotels is considered final.