When is the monthly Royalty Fee due to IHG for an Even Hotels franchise?
Even_Hotels Franchise · 2025 FDDAnswer from 2025 FDD Document
he 15th day of the month falls on a weekend or bank holiday, then the Due Date shall be the next business day.
- (1) Application Fee. Licensee has paid IHG the nonrefundable Application Fee as set forth in Item 3 of Attachment "A").
- (2) Rooms Addition Fee. A standard application fee for additional guest rooms or suites, as set forth in IHG's then current franchise disclosure document for Brand System hotels, will be charged upon application for any guest rooms or suites to be added to the Hotel.
- (3) Royalty Fee. A monthly Royalty Fee in the amount set forth in Item 4 of Attachment "A". Licensee agrees and acknowledges that additional royalties may be charged on revenues from any activity if it is added at the Hotel by mutual agreement and it is not now offered at Brand System Hotels generally or it is designed or developed by or for IHG or its Affiliates. The Royalty Fee is solely in consideration of our granting Licensee the franchise conferred by this License and is not in exchange for any goods, services or assistance which may be furnished by IHG.
- (4) IHG System Fund Contribution.
Source: Item 23 — RECEIPTS (FDD pages 99–438)
What This Means (2025 FDD)
According to Even Hotels' 2025 Franchise Disclosure Document, the Royalty Fee is a monthly fee, as stated in Item 4 of Attachment A. Each payment under paragraph 3.B., except the Rooms Addition Fee or other fees not determined from Gross Rooms Revenue, shall be accompanied by the monthly statement referred to in paragraph 7.A. If any amounts under this License are not paid when due, such non-payment shall constitute a breach of this License and, in addition, such unpaid amounts will accrue interest beginning on the first day of the month following the due date at 1½% per month or the maximum interest permitted by applicable law, whichever is less.
In simpler terms, Even Hotels franchisees are required to pay a monthly Royalty Fee, the amount of which is detailed in another part of the FDD. This fee is due along with a monthly statement. Should a franchisee fail to make a payment on time, they will be in breach of their franchise agreement, and interest will be charged on the outstanding amount, starting from the first day of the month after the payment was due. The interest rate will be 1.5% per month or the maximum rate allowed by law, whichever is lower.
This payment structure is typical in franchising, where royalties are usually collected monthly based on a percentage of gross revenues. The interest penalty for late payments is also a standard provision to ensure timely payments and protect the franchisor's revenue stream. Prospective Even Hotels franchisees should ensure they understand the exact amount of the monthly Royalty Fee and the due date to avoid any penalties or breach of contract.