How is the annual rent calculated for the equipment leased to an Even Hotels franchisee?
Even_Hotels Franchise · 2025 FDDAnswer from 2025 FDD Document
All equipment leased to Customer will be leased at an annual rate calculated by multiplying the total installed cost of equipment by the then-current lease factor, plus all applicable sales and use taxes, if any, as rent for the Equipment.
Rent will be due monthly.
At Company's discretion, Company may utilize funds due Customer to offset amounts due Company under this Lease.
If Customer fails to pay, within 10 days of its due date, rent or any other amount required by this Lease to be paid to Company, Customer will pay to Company a late charge equal to five percent (5%) per month of such overdue payment, or such lesser amount that Company is entitled to receive under any applicable law
Source: Item 23 — RECEIPTS (FDD pages 99–438)
What This Means (2025 FDD)
According to Even Hotels' 2025 Franchise Disclosure Document, the annual rent for leased equipment is calculated by multiplying the total installed cost of the equipment by the then-current lease factor, plus any applicable sales and use taxes. The rent is due monthly. The current lease factor for equipment and dispensers is 0.24. If the lease factor changes during the term, any equipment installed after the change will be subject to the new lease factor. The lease factor remains in effect even if the ownership or management of the hotel changes.
Even Hotels may use funds due to the franchisee to offset amounts owed to Even Hotels under the lease. If the franchisee fails to pay rent or any other amount within 10 days of the due date, Even Hotels will charge a late fee of 5% per month of the overdue payment, or a lesser amount if required by applicable law.
This arrangement means that the franchisee's rental costs are directly tied to the initial cost of the equipment and the prevailing lease factor. Changes to the lease factor could impact the franchisee's expenses, so it's important to understand how often this factor is reviewed and adjusted by Even Hotels. Additionally, the potential for Even Hotels to offset payments and the imposition of late fees highlight the importance of maintaining timely payments to avoid additional charges and potential disruptions.