Everhome_Suites 2025 Franchise FAQ - FDD Ninja

Question 1

What are the conditions under which Everhome Suites might offer financing for renovations or upgrades?

Accepted Answer

with Choice for the re-licensing of an existing Choice brand hotel and qualify and accept the Incentive are not eligible to participate in any other incentive program.

## **PMC COMMERCIAL TRUST**

We have entered into a non-exclusive Qualified Vendor agreement with a third party named PMC Commercial Trust (previously known as PMC Capital, Inc.) ("PMC"), which is a company authorized to provide loans. Under this agreement, PMC may offer conventional and Small Business Administration ("SBA") financing to those of our franchisees that qualify and choose to use PMC to finance some of the following costs: affiliation fee, site acquisition, construction or remodeling, equipment and/or fixtures, opening inventory or supplies, ongoing inventory or supplies, replacement of equipment or fixtures, and other continuing expenses. These loans are generally for up to 70% to 85% of the value of the collateral and range from \$500,000 to \$5,000,000 for acquisitions, refinances and construction/permanent loans.

Interest rates are generally variable and are at PMC's discretion. You are not required to use PMC as your lender. If you choose to use PMC as your lender, you must enter into agreements with PMC, substantially in the form attached as Exhibit K or as PMC may otherwise require depending on your specific loan. The loan will be for up to 25 years and will require monthly payments, with the amount of the payments based on the terms agreed upon. You must grant a first lien on land and building, a first lien on furniture, fixtures and equipment and, if necessary, a lien on your personal assets. PMC will require that you personally guarantee the loan. The loans can be pre-paid but there may be a pre-payment penalty.

If you default on the note, the entire remaining principal balance becomes due and the lender may have the right to take possession of the collateral and/or sell or lease the collateral. You must waive your rights to presentment for payment, demand, protest, notice of non-payment or dishonor, notices of protest and all other demands or notices. On default, the note will bear interest at the maximum rate permitted by applicable law. You must also pay PMC all the costs of collection or costs of exercising its remedies, including attorneys' fees. You must waive your right to object to jurisdiction in the courts of Dallas, Texas as the venue for the resolution of disputes and must waive your right to a trial by jury. See the sample documents in Exhibit K for PMC's additional rights and remedies.

In consideration of Choice's agreement to grant PMC access to our marketing channels, Choice will receive from PMC a flat payment of \$10,000 annually.

Question 2

What are the Everhome Suites franchisee's obligations regarding participating in the franchisor's marketing and advertising programs, as referenced in Item 9?

Accepted Answer

| TYPE OF EXPENDITURE | AMOUNT (Note 2) | | METHOD OF PAYMEN T | WHEN DUE | TO WHOM PAYMENT IS TO BE MADE | |---|---|---|---|---|---| | | Low | High | | | | | Affiliation Fee (Note 3) | $50,000 for properties with 114 rooms or less; $300/per room for each additional room ($50,000 minimum). | | Lump sum | Upon application | Us | | Permits, Licenses and Government Fees | Varies | Varies | As incurred | Before opening | Your general contractor (varies by local jurisdiction) | | Professional Design Services (Note 4) | $200,000 | $450,000 | As incurred | Before opening | Your Architect, Interior Design & Engineering consultants | | Legal Fees | $10,000 | $40,000 | As incurred | Before opening | Your attorneys | | Feasibility/Market/En vironmental Impact Studies (if necessary) | $3,000 | $35,000 | As incurred | Before opening | Your consultants | | Construction (excluding soft costs) (Note 5) | $10,830,000 | $14,575,000 | As incurred | Before opening | Your general contractor | | Insurance (Note 6) | $45,000 | $165,000 | As incurred | Before opening | Your insurance carriers | | Pre-opening | $5,000 | $60,000 | As | Before opening | Various advertising | | Advertising | | | incurred | | media | | Furniture, Fixtures & | $650,000 | $700,000 | As | Before opening | Your suppliers or | | Equipment (Note 7) | | | incurred | | Qualified Vendor | | Hardware to operate the choiceADVANTAGE® property management system | $3,800 | $10,800 | Lump sum | Before opening | Us, as a part of our Brand in a Box program. See also Item 5. | | choiceADVANTAGE® | $8,750 | $10,750 | Lump sum | Before opening | Us, as a part of our | | Software License and | | | | | Brand in a Box | | Systems Training Fees | | | | | program. See also Item | | (Note 8) | | | | | 5. | | Opening Inventory of | $225,000 | $350,000 | As | Before opening | Your suppliers or | | Supplies (Note 9) | | | incurred | | Qualified Vendor | | Immersion and Hospitality Training Fees (Note 10) | $1,500 | $7,500 | As incurred | Before Completion | Us | | High Speed Internet Access for in-room, in- lobby, public areas and meeting rooms (Note 11) | $14,000 | $25,000 | As incurred | Before opening | Your supplier and/or Qualified Vendor | | TYPE OF EXPENDITURE | AMOUNT (Note 2) Low | High | METHOD OF PAYMEN T | WHEN DUE | TO WHOM PAYMENT IS TO BE MADE | | Mandatory On- Premise Signs (including freight and installation and plus maintenance and insurance) | $20,000 | $100,000 | As incurred | Before opening | Qualified Vendor | | Construction Advisory Services Agreement – See Item 5 | $0 | $20,000 | As incurred | Before Opening | Us | | Professional Pre- | $1,500 | $4,000 | As | Before opening | Qualified Vendor | | Opening Photography | | | incurred | | | | Interior Design | $0 | $20,000 | As | Before opening | Us | | Waiver Fee (Note 12) | | | incurred | | | | Architectural Design Review & Construction Services (Note 13) | $0 | $20,000 | As incurred and due at the time of request | Before opening | Us | | Working Capital Required Before Operations Begin (Note 14) | $200,000 | $420,000 | As incurred | Before opening | Us, your suppliers, your employees, utilities, consultants | | Additional Funds for 3-Month Initial Period (Note 15) | $50,000 | $75,000 | Monthly payment for recurring fees; as incurred for other expenses | After opening | Us, your suppliers, your employees, utilities | | TOTAL ESTIMATED | $12,317,550 | $17,138,050 | | | | | INITIAL | | | | | | | INVESTMENT (Note | | | | | | | 16) | | | | | | | TOTAL COST PER | $108,049 | $150,334 | | | | | ROOM (Based on 114 | | | | | | | Rooms) | | | | | |Note 1: This table is an estimate of the initial investment required to construct and open a new construction hotel and the estimate provided is based on our experience and our prototype designs. Estimates are based on a 114-room hotel. The table does not include the cost of purchasing or leasing real estate, which cannot be estimated with any certainty due to variables such as location, acreage, terms and whether leased or purchased. Note 2: Costs paid to Choice are not refundable, unless otherwise stated. Whether any costs paid to third parties are refundable will vary based on the particular third party and on where your hotel is located. Note 3: The full affiliation fee is due no later than the time you sign the franchise agreement and is non-refundable following our signing of the franchise agreement. If for any reason we do not grant you a franchise or a franchise agreement is not countersigned by us, the affiliation fee, less \$5,000, will be refunded to you. In rare circumstances, in our sole discretion and on approval of your credit, we may offer to finance the affiliation fee without interest as installment payments over the term of the franchise agreement. See Item 10. We otherwise do not finance any portion of the initial investment. - Note 4: Professional Design Services includes costs that are paid to your architect, engineer, and other related professionals for the development of your Hotel, which must follow the prototype architectural drawings and specifications supplied by us. You must submit all drawings and specifications to us, and we must approve of these drawings prior to your submission to local jurisdictions. You must commission an architect and engineer directly and make payments directly to them. - Note 5: The cost of construction may vary substantially from location to location. The type of construction used, site conditions, cost of materials, labor costs, local code requirements, competitive conditions, and other factors will affect the cost. This estimate does not include site work required. The estimate also does not include the cost of permits and licenses. If required, you must pay us \$20,000 for Construction Advisory Services. See Item 6 and Exhibit N. - Note 6: These policies cover construction, General Liability, Cyber Liability, and Workers Compensation, including Statutory Workers Compensation and Employers Liability insurance, and must provide minimum limits per location of coverage as stated in the franchise agreement. - Note 7: This amount does not include taxes, shipping, or installation costs. - Note 8: choiceADVANTAGE® software license and onboarding fees include the costs of the initial software license, onboarding, eLearning modules, project management and the credit card interface. Your costs may fall on the higher end of this range depending on the number of rooms, additional interfaces and integrations you select. The fees do not include the monthly choiceADVANTAGE® support fee to cover ongoing remote software support - Note 9: Opening inventory of supplies includes brand standards items, linen, paper supplies and housekeeping supplies. It also includes supplies required to operate the hotel's kitchen, fitness room, guest laundry, hotel laundry, and phone system. - Note 10: Immersion and Hospitality training includes the cost to attend the Owner Immersion ("ES LAUNCH") and General Manager Operations Certification ("ESsentials", formerly "Embark") programs. The Owner Immersion program incurs a fee not to exceed \$1,250 for the owner and up to one guest. This covers 2 days of immersion training at our headquarters in North Bethesda, Maryland or Scottsdale, Arizona. The costs do not include the cost of travel, lodging, or meals to attend the required training programs. Our ESsentials training fee is \$1,500 and covers the General Manager Operations Certification program that is offered virtually, consisting of self-paced online lessons, live interactive virtual classes, and exams. In addition, if you are an inexperienced hotel franchisee that has never operated an extended stay hotel and you are not planning to use a hotel management company to manage the hotel, we may also require that you and your General Manager attend our separate immersion training program. This additional immersive training, which may take place either in person or online, will provide 2-4 days of additional training at a cost of approximately \$2,500 to \$7,500 and will be tailored for the novice extended stay hotel operator. The foregoing costs do not include the cost of travel, lodging, or meals to attend the required training programs. The costs do not include the cost of travel, lodging, or meals to attend the required training programs. Some or all of the training may not be required a Choice Hotels Extended Stay hotel and/or obtained ES LAUNCH Certification for another existing hotel and/or a General Manager has previously earned the ESsentials or "Embark" Operations Certification within the last six (6) years. - Note 11: The estimate of \$14,000-\$25,000 is based on a wired solution for a hotel that is to be newly constructed for the hotel size indicated. This estimate includes wiring, routers, software, server, splitters, etc. A wireless solution could range from \$4,500-\$9,500 depending upon the number of access points, wiring to the access points, gateway, etc. You must also arrange and pay for the incoming broadband service, which is typically delivered by a commercial grade T-1 or Digital Subscriber Line ("DSL"). You may purchase this from any available broadband supplier; however, we reserve the right to require a single supplier as necessary to ensure that all hotels in the Choice franchise system meet required standards as well as to promote more efficient communications between Choice and your hotel. We currently estimate that the cost will range from \$1,800-\$12,800 per year. This estimate is based on the hotel size indicated and currently includes high speed internet access (delivered by a commercial grade T-1, DSL or a Fractional T-1) and 24/7 support provided by a third party with Tier I and Tier II levels. Your costs will vary depending upon bandwidth usage and your hotel's size and location. Although we currently permit you to purchase these services from any available source, in the future we may require you to use a designated source, as necessary to maintain overall brand standards. We currently require you to use a designated Qualified Vendor to provide your High-Speed Internet Access solution. - Note 12: If you request a waiver from using a pre-approved interior design scheme or Qualified Vendor, you must pay our then-current fee, regardless of whether the waiver is granted. - Note 13: If you request a waiver for using a non-prototypical building design, then you must pay our then-current fee, regardless of whether the waiver is granted. This fee includes an architectural design & engineering review fee and review fee and construction inspection fee in reviewing your request. - Note 14: We estimate that you will need this amount in working capital before the Hotel opens. This includes salaries that you will need to pay to your General Manager, salespeople, and other essential personnel. The actual amount of working capital you will need depends on a variety of factors, such as the number of paid employees you hire and their rate of pay, your own management and operational skills, economic conditions, and competition. The estimate in the table does not include loan origination points. The origination points you may be charged will depend on your specific lender and will vary by the loan type you select. Our experiences estimate that origination points have ranged between 1 and 2 percent of the amount borrowed. We also have not included real estate taxes, which will vary based on location and local real estate costs. - Note 15: We based these estimates on our experience with hotel franchises, discussions with hotel businesspeople and recent trends in pricing from other relevant companies. - Note 16: This table does not include land costs or real estate taxes. In addition, your total investment may be higher if you are required to participate in our Re-Licensing Systems Training. This program is not required for all owners. The Re-Licensing Systems Training fee is \$995 and is payable only when a franchised hotel has changed ownership and the new owner signs a franchise agreement with us. The Re-Licensing Systems Training fee covers the cost of two days of remote training concerning our proprietary choiceADVANTAGE® property management and reservation system. ## **ITEM 8** ## **RESTRICTIONS ON SOURCES OF PRODUCTS AND SERVICES** All EVERHOME SUITES hotels are required to meet the current minimum design standards for the brand, including Choice-approved product in the public space and guestrooms. You must design the hotel to meet the current minimum standards for guestroom size and facilities and equip the hotel with furniture, fixtures and equipment, bath and bed linens, draperies, bedcoverings, floor coverings, wall coverings, lighting, ice machines, telephone systems and other amenities for which we have established written specifications or minimum standards. We may modify our specifications in writing as we determine appropriate from time to time, and may add new specifications or brand guidelines, in writing, including any manuals or policies regarding, among other things, our standards and requirements for construction, equipment, furnishings, supplies, maintenance and marketing that are applicable to EVERHOME SUITES hotels ("Rules and Regulations"). We require you to engage a professional hotel management company ("Management Company") before Construction Start (as defined in the franchise agreement) and retain such Management Company to operate and manage the hotel during the term of the franchise agreement, which will be subject to our prior written consent. Neither we, our affiliates, or our officers own any management company. Except as listed below, neither we, nor any of our affiliates, currently obligate you to purchase or lease from us any goods, services, supplies, FF&E (as defined below), inventory, computer hardware or software. We may require you to purchase proprietary software for accounting and reservations systems and may designate third-party approved vendors to supply products or services as we believe appropriate to assure communications compatibility or other benefits for the System. You must comply with our standards and requirements concerning the quality of all goods, services, fixtures, furniture, furnishings, equipment, supplies and other items ("FF&E items"). We may require that particular FF&E items be purchased from an approved vendor. Otherwise, you may make purchases of FF&E items from any source meeting our standards and specifications after obtaining written approval from Choice. As of the issuance date of this Disclosure Document, there is only one approved vendor for procurement services (currently, Profillment) for new construction properties. We reserve our right to add additional qualified vendors. Standards and requirements are published in the Rules and Regulations, in policy and procedure statements, in EVERHOME SUITES Property prototype designs and specifications, or otherwise communicated to franchisees in printed, machine readable, via intranet, electronic or any form we choose. The standards and specifications, including the Rules and Regulations, may be modified at our discretion. We will also distribute modifications to standards and specifications to you in printed, machine-readable, via intranet, electronic or any form we choose. Neither Choice nor our affiliates are approved suppliers or the only approved supplier for any products. Our Procurement Services Department maintains a list of "Qualified Vendors" of products and services for our franchisees. Certain Qualified Vendors are designated in the Rules and Regulations as an exclusive supplier or as an approved non-exclusive preferred vendor. Unless required by the Rules and Regulations, you do not have to purchase products that otherwise meet brand standards from Qualified Vendors. You do have to purchase certain Choice Mark-bearing items, such as signs and bath amenities, only from Qualified Vendors. You must also purchase bedding, computer hardware, and other brand standard items per brand specifications through a Qualified Vendor. Neither Choice nor any persons affiliated with Choice are currently Qualified Vendors. Vendors that are not on the Qualified Vendor list may apply to become "Qualified," and you may recommend new vendors to us. Among the criteria that we consider is the financial stability of the company, whether the product or service meets brand standards and if the product or service is of use to our franchisees. Our criteria are available to you for review upon your request. Where applicable, the vendor may be asked to submit product samples and specifications to us. We usually make our decision and notify the vendor within 90 days after all information and samples have been submitted, although a longer period may be required for products or services that, due to their cost or importance to the brand, may have significant financial impact on our franchisees. We may limit the number of Qualified Vendors for a variety of reasons, including: obtaining volume discounts; promoting consistent quality; and/or securing adequate supplies for a particular brand. We may revoke a vendor's "Qualified" status if the vendor no longer meets our criteria, if they breach their agreement with us, or if the product or service offered is no longer competitive in price or quality, among other reasons. None of our officers own a material interest in any privately-held suppliers, or a material interest in any publicly-held suppliers of our franchise system. From time to time, our officers may own nonmaterial interests in publicly-held companies that are suppliers to our franchise system. We receive certain commissions or rebates from Qualified Vendors that typically range from 1% to 2% (but may be up to 20%) of net sales volume to franchisees, as well as a flat fee that we typically receive annually from each Qualified Vendor. In exchange for these fees, we may provide each vendor with certain services, which may include one or more of the following: marketing services from our Procurement Managers and/or marketing personnel; space on our ChoiceBuys.com website; a booth at our annual convention; advertisements in our print and electronic publications (e.g., Marketplace and Single Vendor Emails); and sponsorship opportunities, among other benefits. We do not provide franchisees with any material benefits, such as opportunities to acquire additional franchises, based on their purchases of particular products or services from Qualified Vendors or use of particular Qualified Vendors. You must display at your hotel entrance the number and type of identity signs required by the Rules and Regulations. Such signs must display the approved brand name and logo of your hotel. Signs are available from manufacturers who must be approved by us and who must comply with brand specifications. Each sign manufacturer must meet certain business, financial and insurance requirements. We derive income from appointment fees, limited trademark licenses, drawing charges and commissions on signs sold and that are purchased through signage Qualified Vendors. All highway billboards and printed advertising, among other electronic or printed media, must use the Choice Marks in accordance with our specifications. You must also participate in the Choice Hotels Group Sales Lead Referral Program by encouraging your Director of Sales, General Manager, and other hotel staff to refer group reservations from one Choice branded hotel to another Choice branded hotel. As indicated in Item 6 and your brand standards, you may be required to pay a commission on a group reservation if a guest is referred to your hotel as part of the Group Sales Lead Referral Program. We also periodically negotiate preferred marketing agreements with corporations and other organizations for joint marketing efforts, which may result in commissionable stays at your hotel. If you make inventory available to these organizations, we may retain up to 50% of any commissions payable by you in consideration of our marketing services and program administration costs. As described in Item 7, you must obtain and maintain insurance, which will include, at a minimum, insurance policies of the kinds, and in the amounts, required by us (Franchise Agreement, Section 12). These written insurance policies include, at a minimum, the following coverage during construction or complete renovation of the hotel: commercial general liability insurance (including automobile liability, bodily injury and property damage) for all types of liabilities, together with the costs of defense and/or adjustments arising out of the operations to construct the hotel, providing limits of coverage of not less than \$1,000,000 per occurrence, and including coverage for contractual liability, explosion, collapse and underground property damage hazard liability, personal injury liability, products and completed operations liability, owner's and contractor's protective liability, and independent contractor's liability; all-risk builder's insurance to insure the hotel buildings under construction to 100% of their replacement cost value; and a workers' compensation policy as required by statute. During the operation of the hotel, required insurance policies include, at a minimum: all-risk physical damage coverage insuring the hotel and its contents for full replacement costs; commercial automobile (including hired and non-owned automobile) and commercial general liability insurance policies written on an occurrence form, which must include contractual, products and completed operations, independent contractors, personal injury, property damage, bodily injury and host liquor liability coverage, together with the costs and expenses of the defense and/or adjustment of injury or damage, providing limits of coverage, per location, of not less than \$5,000,000 (\$10,000,000 to \$15,000,000 if the hotel has 6 or more stories) per occurrence; cyber liability insurance coverage that provides minimum coverage of \$1,000,000 per location workers' compensation and employers' liability insurance with minimum employers liability limits of \$1,000,000 bodily injury by accident (each accident); \$1,000,000 bodily injury by disease (policy limit); and \$1,000,000 bodily injury by disease (each employee), whether or not required by the state where the hotel is located; dram shop/liquor liability insurance with limits of not less than \$5,000,000 per occurrence if alcoholic beverages are sold at the hotel (whether or not you own the establishment that sells alcohol); pollution/environmental legal liability insurance \$500,000 per pollution incident/\$1,000,000 aggregate, covering bodily injury, property damage, cleanup costs and defense costs arising from, or associated with, a pollution condition at a covered location. There will be no exclusion for carbon monoxide, and affirmative coverage for Legionella and microbial matter/mold; employment practices liability insurance \$1,000,000 limit, including \$1,000,000 third party coverage; and business interruption insurance that provides coverage for a minimum of three months in the event the hotel is not operational. You must also obtain and attach endorsements to your insurance policies adding us and our affiliates and subsidiaries, our and their respective officers, directors, agents, partners and employees, as additional insureds and provide waiver of subrogation on commercial automobile, commercial general, workers' compensation/employers' liability (if allowed), pollution liability, umbrella insurance policies and dram shop/liquor liability (if applicable), and adding us as co-defendant under the employment practices liability policies. If you fail to procure or maintain the minimum insurance described above (or as designated by us from time to time in the brand standards or Rules and Regulations), we may procure the insurance on your behalf and charge you the cost of the insurance and, at our option, a reasonable penalty. You will be required to reimburse us for the cost of such insurance and for any reasonable out-of-pocket costs that we incur should we elect to obtain the insurance on your behalf. You must purchase from us a software license to onboard and use choiceADVANTAGE®. You also must purchase the mandatory hardware package we specify that meets or exceeds specifications needed to operate choiceADVANTAGE®. You are required to use a designated Qualified Vendor to purchase and install a dedicated, wired, business grade High Speed Internet Access solution located at the front desk for access to choiceADVANTAGE® (see Items 5, 7 & 11 for more details). Unless mandated by the brand standards contained in the then-current version of the Rules and Regulations, you do not have to participate in any purchasing or distribution cooperative we maintain. However, the Choice Partner Services Department attempts to negotiate price terms believed to beneficial from its Qualified Vendors for franchisees, and we may from time to time offer cooperative buying programs to provide additional savings. In addition, you will automatically become a member of a cooperative buying program at no additional cost to you. You may opt out of being a member of such program at any time by completing and sending us the opt out electronic form located within the FAQs on Choicebuys.com. Most product and services offerings are accessible via ChoiceBuys.com, a proprietary web-based electronic catalogue. In the year ended December 31, 2024, our total revenues were about \$1,584.8 million. Of this figure, revenues attributable to required purchases by franchisees of products and services were \$67.7 million, or about 4.27% of our total revenues in 2024, which includes revenues from Qualified Vendors and excludes choiceADVANTAGE® installation and support fees. We estimate that your required purchases of goods and services from us, our designees, approved suppliers and under our approved specifications will account for between 90% and 100% of all purchases you will make in establishing and operating the Franchised Business. ## **ITEM 9** ## **FRANCHISEE'S OBLIGATIONS** **This table lists your principal obligations under the franchise and other agreements. It will help you find more detailed information about your obligations in these agreements and in other items of this Disclosure Document.** | Obligation | Section in Franchise Agreement | Section in Master Development Agreement | Section in choiceADVANTAGE Terms of Use | Section in Call Forwarding Program Terms of Use | Disclosure Docu

Question 3

Must the Everhome Suites franchisee comply with the Rules and Regulations?

Accepted Answer

to Gross Room Revenue, other revenues, expenses, occupancy and room rates data, reservation data, and such other information as we may require. Any report required to be submitted hereunder not actually received by us on or before the date the related payment was due shall be deemed overdue unless postmarked at least 5 days prior to the date it was due.
- g. Interest. You will pay us interest on all charges, costs, fees and amounts due under this Agreement but not paid on time at the rate of 1.5% per month, but not more than the maximum interest rate permitted by applicable law.

### **5. Our Duties**. We will during the Term:

- a. Rules and Regulations. Make available to you an electronic copy of the Rules and Regulations;
- b. Quality Assurance. Administer quality assurance programs as described in the Rules and Regulations that may include periodic visits to the Hotel (by us or authorized third parties) and/or guest satisfaction surveys and guest reviews to evaluate your compliance with this Agreement and the Rules and Regulations and advise you of any defaults and on changes that you must make at your expense to the Hotel or its operations to comply with this Agreement or the Rules and Regulations;
- c. System Services.

Source: Item 23 — Receipts (FDD pages 90–320)

Question 4

Are the recommendations provided during consultation with Everhome Suites binding?

Accepted Answer

Any guidance, recommendations, or advice provided to you during such consultation shall be deemed suggestions only, and the decision to follow any such guidance, recommendations, or advice will be made by you in your sole discretion.

Source: Item 23 — Receipts (FDD pages 90–320)

Everhome_Suites 2025 FDD FAQ