Does making misrepresentations to Sonesta Select Sonesta Essential constitute an Event of Default?

According to Sonesta Select Sonesta Essential's 2025 Franchise Disclosure Document, making misrepresentations to the company can trigger an Event of Default under the franchise agreement. This means that if a franchisee provides false or misleading information to Sonesta Select Sonesta Essential, whether during the initial application process or during the ongoing operation of the hotel, it can be considered a breach of contract.

Specifically, an Event of Default can occur if a franchisee makes any misrepresentations to Sonesta Select Sonesta Essential, whether in entering into the Franchise Agreement or in the performance of their obligations to the company. This is a broad clause that covers any instance where the franchisee provides inaccurate information to the franchisor.

If an Event of Default occurs, Sonesta Select Sonesta Essential has several options, including suspending their obligations under the agreement, removing the hotel's listing from directories, and terminating the agreement. The franchisee may have an opportunity to cure the default, but this is not guaranteed. If the default is cured, Sonesta Select Sonesta Essential will restore the franchisee's access to the Central Reservation System and include them in future directories and advertising, but they are not required to redirect any reservations that were diverted to other Network Hotels during the period of suspension.

This clause highlights the importance of honesty and transparency in the franchisee-franchisor relationship. Any misrepresentation, whether intentional or unintentional, can have serious consequences for the franchisee, potentially leading to the loss of their franchise.