Who is responsible for the expenses associated with an audit of an Even Hotels location?
Even_Hotels Franchise · 2025 FDDAnswer from 2025 FDD Document
, cost, expense (including attorney fees), liability, damage, or claim (including strict liability in tort) (a) related to or arising from the Curated Solutions; or (b) for the selection, quality, condition, merchantability, suitability, fitness, operation, installation, repair, adjustment, or performance of the Curated Solutions or the adequacy, quality, delay or suitability of the maintenance or support services provided by a third party pursuant to this Master Technology Schedule or for any interruption or loss of service or use of network connectivity or the Software. Such liability, if and to the extent it may exist, rests solely with the applicable Service Provider of the Curated Solution to IHG and the Hotel.
12. AUDITS.
12.1 During the License Term and for a period of two years following any expiration or termination of the License, IHG or its designated representative may enter upon the premises of the Hotel during regular business hours upon no less than twenty-four (24) hours' notice to audit and review Licensee's (i) use of the Curated Solutions; (ii) verify compliance with the License and the Enabling Agreements; and (iii) ensure compliance with applicable laws and Security Practices. Licensee will cooperate with any such audit at Licensee's expense. Any fees or amounts determined to be due, or any remedial action to be undertaken, as a result of Licensee's audited use of the Curated Solutions or Security Practices not in compliance with this Master Technology Schedule shall be the sole responsibility of Licensee. Nothing in this Section shall be deemed to limit IHG's rights to perform monitoring of the Curated Solutions at any time.
13. MISCELLANEOUS PROVISIONS.
- 13.1.1 Survival. Section 11 (Damages) and, to the extent necessary, Schedule 1 (Definitions) of this Master Technology Schedule shall survive the expiration or termination of the License.
- 13.1.2 Licensee Agents. Licensee will cause each of its Agents to comply with the terms and conditions of the License including, without limitation, this Master Technology Schedule. Licensee will be responsible for the acts and omissions of each of its Agents, including any failure by any such Agent to comply with the terms set forth herein.
- 13.1.3 Force Majeure.
Source: Item 23 — RECEIPTS (FDD pages 99–438)
What This Means (2025 FDD)
According to Even Hotels' 2025 Franchise Disclosure Document, the franchisee, referred to as the Licensee, is generally responsible for the expenses associated with audits. Specifically, the Licensee will cooperate with any audit conducted by IHG (or its representative) at the Licensee's expense. This includes audits related to the use of Curated Solutions, compliance with the license and enabling agreements, and adherence to applicable laws and security practices.
Furthermore, if an audit reveals a deficiency in payments due to IHG, the Licensee is responsible for paying the deficiency along with interest and an audit fee of $3,000, which IHG may increase. However, if the audit does not find a deficiency, no audit fee will be assessed. If an overpayment is discovered during the audit, IHG will credit this overpayment against future payments or promptly refund it to the Licensee without interest.
This means that as an Even Hotels franchisee, you should maintain accurate and complete financial records to minimize the risk of a deficiency being discovered during an audit. You should also ensure compliance with all applicable laws, security practices, and the terms of your franchise agreement to avoid potential issues identified during an audit. The potential for incurring audit fees and the cost of correcting any deficiencies should be factored into your financial planning.
It is important to note that IHG retains the right to perform monitoring of the Curated Solutions at any time, which is separate from the formal audit process. This continuous monitoring could also lead to the discovery of non-compliance issues that the franchisee would need to address at their own expense.