Can Sonesta Select Sonesta Essential condition its consent to a proposed transfer?
Sonesta_Select_Sonesta_Essential Franchise · 2025 FDDAnswer from 2025 FDD Document
C. Conditions for Approval of Transfer. If you (and your owners) are in full compliance with this Agreement, then you may request our consent to a proposed transfer. We will give your request reasonable consideration but may condition our consent on compliance with certain requirements, including the following:
- (1) you have paid all Royalty and Brand Promotion Fee payments, and other amounts owed to us, our affiliates, and third-party vendors and have submitted all required reports and statements;
- (2) you have not violated any provision of this Agreement, the Lease, or any other agreement with us during both the 60-day period before you requested our consent to the transfer
and the period between your request and the effective date of the transfer, nor have you received a notice of termination from us;
(3) neither the transferee nor its owners (if the transferee is an Entity) or affiliates have an ownership interest (direct or indirect) in or perform services for a Competitive Business;
(4) you provide us all information or documents we request about the proposed transfer, the transferee, and its owners;
(5) the transferee completes to our satisfaction any training, brand introduction and/or orientation program that we require at the time of the transfer;
(6) your landlord, if applicable, allows you to transfer the Lease or sublease the Premises to the transferee;
(7) the transferee agrees (if the transfer is of this Agreement) to meet with us at our request, either virtually or in person, to conduct an inspection of the Premises and develop a PIP for necessary upgrades, remodeling, and refurbishment of your Hotel and your Hotel's FF&E in accordance with our then-current requirements and specifications for Brand Hotels, and complete the Renovation Work therein within 120 days after the effective date of the transfer;
(8) the transferee, at our request, signs our then current form of franchise agreement and related documents, any and all of the provisions of which may differ materially from any and all of those contained in this Agreement;
Source: Item 22 — CONTRACTS (FDD page 84)
What This Means (2025 FDD)
According to Sonesta Select Sonesta Essential's 2025 Franchise Disclosure Document, Sonesta Select Sonesta Essential can condition its consent to a proposed transfer. The FDD states that if the franchisee and its owners are in full compliance with the agreement, they may request consent for a proposed transfer. Sonesta Select Sonesta Essential will give the request reasonable consideration but may condition its consent on compliance with certain requirements.
These conditions include ensuring that all Royalty and Brand Promotion Fee payments, and other amounts owed to Sonesta Select Sonesta Essential, its affiliates, and third-party vendors have been paid, and all required reports and statements have been submitted. Additionally, the franchisee must not have violated any provision of the Agreement, the Lease, or any other agreement with Sonesta Select Sonesta Essential during the 60-day period before the transfer request and the period between the request and the effective date of the transfer, and must not have received a notice of termination.
Further conditions include that neither the transferee nor its owners have an ownership interest in or perform services for a Competitive Business. The franchisee must also provide all requested information or documents about the proposed transfer, the transferee, and its owners. The transferee may also be required to complete training, brand introduction, or orientation programs to Sonesta Select Sonesta Essential's satisfaction. The landlord, if applicable, must allow the transfer of the Lease or sublease of the Premises to the transferee. The transferee must also agree to meet with Sonesta Select Sonesta Essential to conduct an inspection and develop a Property Improvement Plan (PIP) for necessary upgrades and complete the renovation work within 120 days after the transfer's effective date. Finally, the transferee may be required to sign Sonesta Select Sonesta Essential's then-current form of franchise agreement, which may differ materially from the original agreement.