What is the purpose of the Collateral Assignment of Online Presences for Americas Best Value Inn?
Americas_Best_Value_Inn Franchise · 2025 FDDAnswer from 2025 FDD Document
FOR VALUE RECEIVED, Franchisee hereby assigns to Franchisor all websites, domain names, homepages, e-mail addresses, social media accounts, usernames, other online presence, or presence on any electronic, virtual, or digital medium of any kind (each an "Online Presence") associated with Franchisor's trademarks and service marks and used from time to time in connection with the operation of the Franchised Business at the address provided above. This Assignment is for collateral purposes only and, except as specified herein, Franchisor shall have no liability or obligation of any kind whatsoever arising from or in connection with this Assignment, unless Franchisor shall notify the companies managing the Online Presences (the "Service Providers") and Franchisee's Internet service provider ("ISP") to effectuate the assignment pursuant to the terms hereof.
Upon termination or expiration of the Franchise Agreement (without extension), Franchisor shall have the right and is hereby empowered to effectuate the assignment of the Online Presences. In such event, Franchisee shall have no further right, title, or interest in the Online Presences, and shall remain liable to the Service Providers and the ISP for all past due fees owing to the Service Providers and the ISP on or before the effective date of the assignment hereunder.
Franchisee agrees and acknowledges that as between Franchisor and Franchisee, upon termination or expiration of the Franchise Agreement, Franchisor shall have the sole right to and interest in the Online Presences, and Franchisee irrevocably appoints Franchisor as Franchisee's true and lawful attorney-in-fact, which appointment is coupled with an interest, to direct the Service Providers and the ISP to assign same to Franchisor, and execute such documents and take such actions as may be necessary to effectuate the assignment. Upon such event, Franchisee shall immediately notify the Service Providers and the ISP to assign the Online Presences to Franchisor. If Franchisee fails to promptly direct the Service Providers and the ISP to assign the Online Presences to Franchisor, Franchisor shall direct the Service Providers and the ISP to effectuate the assignment contemplated hereunder to Franchisor. The parties agree that the Service Providers and the ISP may accept Franchisor's written direction, the Franchise Agreement, or this Assignment as conclusive proof of Franchisor's exclusive rights in and to the Online Presences upon such termination or expiration and that such assignment shall be made automatically and effective immediately upon each Service Provider's and ISP's receipt of such notice from Franchisor or Franchisee. The parties further agree that if the Service Provider or the ISP requires that the parties execute the Service Provider's or the ISP's assignment forms or other documentation at the time of termination or expiration of the Franchise Agreement, Franchisor's execution of such forms or documentation on behalf of Franchisee shall effectuate Franchisee's consent and agreement to the assignment. The parties agree that at any time after the date hereof they will perform such acts and execute and deliver such documents as may be necessary to assist in or accomplish the assignment described herein upon termination or expiration of the Franchise Agreement.
All rights of Franchisor shall inure to its benefit and to the benefit of its successors and assigns. Franchisor may assign its rights under this Agreement to any designee. This Assignment may be executed in multiple counterparts, each of which shall be deemed to be an original and all of which taken together shall constitute one and the same agreement. The parties agree that scanned or electronic signatures shall have the same effect and validity, and may be relied upon in the same manner, as original signatures.
Source: Item 22 — CONTRACTS (FDD page 71)
What This Means (2025 FDD)
According to the 2025 Americas Best Value Inn Franchise Disclosure Document, the Collateral Assignment of Online Presences ensures that the franchisor, Sonesta RL Hotels Franchising Inc., maintains control over the brand's online identity and presence. This assignment involves the franchisee assigning all websites, domain names, email addresses, social media accounts, and other online presences associated with Americas Best Value Inn's trademarks to the franchisor. However, this assignment is solely for collateral purposes, meaning the franchisor assumes no liability or obligation unless they notify the relevant service providers to effectuate the assignment.
Upon termination or expiration of the franchise agreement, the franchisor has the right to fully effectuate the assignment of these online presences. At that point, the franchisee loses all rights to the online presences and remains responsible for any outstanding fees owed to service providers up to the date of assignment. This provision protects the brand's reputation and ensures a consistent online presence, as the franchisor can take immediate control of all online assets associated with the brand when a franchise agreement ends.
The franchisee also irrevocably appoints the franchisor as their attorney-in-fact to direct service providers and ISPs to assign the online presences. This allows the franchisor to act on behalf of the franchisee to ensure a smooth transfer. The FDD specifies that service providers and ISPs can accept the franchisor's written direction, the Franchise Agreement, or the Collateral Assignment as conclusive proof of the franchisor's rights. This arrangement streamlines the process and ensures that the franchisor can quickly and efficiently manage the brand's online presence, even if the franchisee fails to cooperate. This is particularly important for maintaining brand consistency and preventing any potential misuse of the brand's online assets after a franchise agreement terminates.