What constitutes a breach of the Sonesta Select Sonesta Essential agreement regarding the use of Marks?
Sonesta_Select_Sonesta_Essential Franchise · 2025 FDDAnswer from 2025 FDD Document
Opening your Hotel before we authorize you to open will constitute unauthorized use of the Marks and a material breach of the Franchise Agreement.
If you open your Hotel prior to our authorization, you agree to pay to us damages as set forth in Section 14.G(3) of the Franchise Agreement.
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IN WITNESS WHEREOF, the parties have executed this Rider as of the Effective Date of the Franchise Agreement.
SONESTA RL HOTELS FRANCHISING INC. [Franchisee Name]
Source: Item 22 — CONTRACTS (FDD page 84)
What This Means (2025 FDD)
According to Sonesta Select Sonesta Essential's 2025 Franchise Disclosure Document, several actions can constitute a breach of the franchise agreement regarding the use of its Marks. One significant breach occurs if a franchisee opens their hotel before receiving written authorization from Sonesta Select Sonesta Essential. This is considered an unauthorized use of the Marks and a material breach of the Franchise Agreement.
Additionally, the franchise agreement states that the franchisee's right to use the Marks is strictly derived from the agreement and is limited to operating the hotel according to the agreement's terms and the Brand Standards set by Sonesta Select Sonesta Essential. Any unauthorized use of the Marks by the franchisee or their owners infringes upon Sonesta Select Sonesta Essential's rights and constitutes a breach. The franchisee acknowledges that all goodwill associated with the use of the Marks benefits Sonesta Select Sonesta Essential.
Furthermore, upon termination or expiration of the franchise agreement, the franchisee must cease all use of the Marks or any similar imitations. They cannot identify themselves as a current or former franchisee, and they must cancel any registrations related to the use of the Marks. Failure to comply with these de-identification obligations also constitutes a breach of the agreement.
In practical terms, these stipulations mean that a Sonesta Select Sonesta Essential franchisee must be extremely diligent in adhering to the franchisor's guidelines and standards for using the brand's Marks. Any deviation, whether it's premature opening, unauthorized usage during the agreement, or continued use after termination, can lead to legal and financial repercussions.