What is the definition of 'Fee Adjustment' and how often can Sonesta Simply Suites adjust the fees?
Sonesta_Simply_Suites Franchise · 2025 FDDAnswer from 2025 FDD Document
Note 9 – These fees are subject to, no more than once per year, the Fee Adjustment. "Fee Adjustment" means an increase at our discretion by up to the greater of (i) 5% annually (or 10% for TMC and Consortia Fees and Operations Insights fees) on a compounding basis regardless of whether we exercise such adjustment in any calendar year, or (ii) the difference, expressed as a percentage, in CPI as determined by comparing the CPI in effect as of the Effective Date to the CPI in effect as of the date of the Fee Adjustment, without reference to any prior Fee Adjustment, if any. "CPI" means the National Consumer Price Index-All Urban Consumers-All Items (1982- 1984 = 100) published by the U.S. Department of Labor (or if the CPI is no longer published, another substitute reference reasonably designated by us).
Source: Item 6 — OTHER FEES (FDD pages 25–36)
What This Means (2025 FDD)
According to Sonesta Simply Suites' 2025 Franchise Disclosure Document, the 'Fee Adjustment' refers to the brand's ability to increase certain fees. Sonesta Simply Suites can adjust these fees no more than once per year.
The 'Fee Adjustment' is defined as an increase, at Sonesta Simply Suites' discretion, by up to the greater of two calculations. The first is 5% annually (or 10% for TMC and Consortia Fees and Operations Insights fees) on a compounding basis, regardless of whether Sonesta Simply Suites exercises such adjustment in any calendar year. The second calculation is the difference, expressed as a percentage, in the National Consumer Price Index (CPI). This is determined by comparing the CPI in effect as of the Effective Date to the CPI in effect as of the date of the Fee Adjustment, without reference to any prior Fee Adjustment.
The CPI used is the National Consumer Price Index-All Urban Consumers-All Items (1982-1984 = 100) published by the U.S. Department of Labor. If the CPI is no longer published, Sonesta Simply Suites can designate another substitute reference reasonably.