Who must execute the Guaranty and Assumption of Obligations for a Sonesta Select Sonesta Essential franchise transfer?
Sonesta_Select_Sonesta_Essential Franchise · 2025 FDDAnswer from 2025 FDD Document
Assignee shall, concurrently with the execution of this Agreement, execute our current form of franchise agreement and related agreements (to reflect that the agreement is executed in connection with a transfer of the rights under the Existing Franchise Agreement) (the "New Franchise Agreement"), and Assignee Owner[s] shall execute the Guaranty and Assumption of Obligations attached thereto.
The New Franchise Agreement will govern Assignee's ownership and operation of the Hotel from and after the Closing Date.
If the Transfer is not consummated on or prior to the Outside Date, and we terminate this Agreement and withdraw our consent to the Transfer, then Assignee acknowledges and agrees that the New Franchise Agreement becomes null and void.
Source: Item 23 — RECEIPTS (FDD pages 84–261)
What This Means (2025 FDD)
According to Sonesta Select Sonesta Essential's 2025 Franchise Disclosure Document, in the event of a franchise transfer, the Assignee Owner(s) are required to execute the Guaranty and Assumption of Obligations. This document is attached to the New Franchise Agreement, which the Assignee must also execute.
This requirement ensures that the incoming owner(s) of the Sonesta Select Sonesta Essential franchise personally guarantee the obligations and responsibilities outlined in the franchise agreement. This is a common practice in franchising, as it provides the franchisor with an additional layer of security and assurance that the franchisee will uphold their commitments.
If the transfer of the Sonesta Select Sonesta Essential franchise does not occur by the agreed-upon date, and Sonesta Select Sonesta Essential withdraws its consent, the New Franchise Agreement becomes void. This condition underscores the importance of meeting all requirements and timelines associated with the transfer process.