What constitutes non-compliance that would trigger a non-compliance charge for a Sonesta Select Sonesta Essential franchisee?
Sonesta_Select_Sonesta_Essential Franchise · 2025 FDDAnswer from 2025 FDD Document
to $5,000 for other documentation, subject to Fee Adjustments), plus any additional costs we may incur in preparing or reviewing such documentation, including reasonable attorneys' fees.
- I. Interest on Late Payments. If any amount due from you hereunder is not paid when due, such non-payment will constitute a material breach of this Agreement. In addition, we may assess a late payment charge of 1.5% per month or the maximum amount permitted by applicable law, whichever is less, on the unpaid amount beginning on the first day following the due date. Should we engage legal counsel or other professionals in connection with any failure by you to pay when due any monies owed under this Agreement or submit when due any reports, information or supporting records, or in connection with any failure otherwise to comply with this Agreement, you will reimburse us on demand for all the above-listed costs and expenses we incur, whether or not a legal action or other proceeding is initiated. You acknowledge that this Section 3.I is not our agreement to accept any payments after they are due or our commitment to extend credit to, or otherwise finance your operation of, your Hotel.
- J.
Source: Item 22 — CONTRACTS (FDD page 84)
What This Means (2025 FDD)
According to the 2025 Franchise Disclosure Document, non-compliance that would trigger a charge for a Sonesta Select Sonesta Essential franchisee includes failing to make payments when due and opening the hotel before receiving written authorization. Specifically, if any amount due from the franchisee is not paid when due, it constitutes a material breach of the agreement. In such cases, Sonesta Select Sonesta Essential may assess a late payment charge of 1.5% per month, or the maximum amount permitted by applicable law, whichever is less, on the unpaid amount, beginning the day after the due date.
Additionally, if Sonesta Select Sonesta Essential engages legal counsel or other professionals because the franchisee failed to pay monies owed, submit reports, or otherwise comply with the agreement, the franchisee will reimburse Sonesta Select Sonesta Essential for all costs and expenses incurred.
Furthermore, a franchisee will face financial penalties for opening their Sonesta Select Sonesta Essential hotel before receiving written authorization from the company. Opening without authorization constitutes unauthorized use of the Marks and a material breach of the Franchise Agreement, resulting in damages as outlined in Section 14.G(3) of the Franchise Agreement.