In what currency must the royalty fee be paid by a Sonesta Simply Suites franchisee?
Sonesta_Simply_Suites Franchise · 2025 FDDAnswer from 2025 FDD Document
- for onboarding services we provide to you in connection with the opening of your Hotel as a Brand Hotel. This fee is non-refundable and is due during or immediately after the onboarding process.
- C. Royalty Fee. Beginning on the earlier of (a) the Opening Date, or (b) the date you begin operating your Hotel under the Marks, you will pay to us via ACH in U.S.
Source: Item 22 — CONTRACTS (FDD pages 79–80)
What This Means (2025 FDD)
According to Sonesta Simply Suites's 2025 Franchise Disclosure Document, royalty fees must be paid in U.S. dollars. Specifically, the franchisee is required to pay the royalty fee via ACH (Automated Clearing House) in U.S. dollars. This payment is due on or before the twentieth day of each month, covering the preceding calendar month. The royalty fee is 5% of Gross Rooms Revenue.
This requirement ensures that all financial transactions between the franchisee and Sonesta Simply Suites are conducted in a standardized and easily manageable currency. Using ACH for payments streamlines the process, making it more efficient and reliable for both parties. Franchisees need to ensure they have a U.S. dollar-denominated account and the ability to make ACH payments to comply with this requirement.
The stipulation that all amounts payable must be in U.S. dollars (or another currency designated by Sonesta Simply Suites) extends beyond just royalty fees. This implies that any other fees or payments required under the Franchise Agreement, such as marketing contributions or technology fees, must also be paid in U.S. dollars unless otherwise specified by Sonesta Simply Suites. This standardization simplifies accounting and financial management for both the franchisee and franchisor.