What is the purpose of the Failure to De-Identify Damages fee charged by Sonesta Select Sonesta Essential?
Sonesta_Select_Sonesta_Essential Franchise · 2025 FDDAnswer from 2025 FDD Document
anchise Agreement in connection with such termination. |
| TYPE OF FEE | AMOUNT | DUE DATE | REMARKS (Note 1) |
|---|---|---|---|
| average monthly | |||
| Gross Rooms | |||
| Revenue shall be | |||
| based on the average | |||
| Gross Rooms | |||
| Revenue of your Hotel | |||
| for all full calendar | |||
| months during the | |||
| period commencing | |||
| on the Opening Date | |||
| and ending as of the | |||
| last full calendar | |||
| month immediately | |||
| preceding the last | |||
| date of regular | |||
| operations of your | |||
| Hotel. | |||
| Pre-Opening Damages | $3,600 per Guest Room | Upon demand | You must pay us these damages if we terminate the Franchise Agreement for your breach before the authorized opening of your Hotel. |
| Unauthorized Opening Damages | $5,000 per day that your Hotel is open without authorization and our costs, including attorneys' fees | Upon demand | If you open your Hotel before we authorize it to open as a Brand Hotel, you must pay us liquidated damages to compensate us for damage to our Marks. You also must reimburse us for our costs of enforcing our rights. |
| Failure to De Identify Damages | $500 per day, plus our expenses | Upon demand | If you fail to comply with all of your de identification obligations within 30 days after the expiration or termination of your Franchise Agreement, you must pay us this fee for each day in which you are in breach of your obligations. This is in addition to other damages and remedies to which we may be entitled under applicable law. |
| Revenue Management For Hire | $995 to $2,500 per month depending on your room count, market, and square feet of function space | Payable monthly by the 20th day of the following month | Note 10 provides a description of this service which is required unless your Hotel has a Revenue Manager who meets our criteria. See Note 9. |
| Revenue Management System | $6.44 per Guest Room per month | Payable monthly by the 20th day of the following month | Fees |
Source: Item 6 — OTHER FEES (FDD pages 24–36)
What This Means (2025 FDD)
According to Sonesta Select Sonesta Essential's 2025 Franchise Disclosure Document, the Failure to De-Identify Damages fee is charged if a franchisee fails to remove all branding and identification marks from the hotel within 30 days after the franchise agreement expires or is terminated. This fee is $500 per day, plus any expenses Sonesta Select Sonesta Essential incurs due to the franchisee's failure to comply with de-identification obligations.
This fee serves to protect Sonesta Select Sonesta Essential's brand and prevent customer confusion. After a franchise agreement ends, the hotel is no longer authorized to operate as a Sonesta Select Sonesta Essential and must not appear to be associated with the brand. The de-identification process ensures that all Sonesta Select Sonesta Essential signage, logos, and other identifying marks are removed from the premises.
The Failure to De-Identify Damages fee is in addition to any other damages or legal remedies that Sonesta Select Sonesta Essential may pursue. This means that a former franchisee could face significant financial penalties for failing to de-identify their hotel in a timely manner. Franchisees should be aware of these obligations and have a plan in place to ensure compliance upon termination or expiration of the franchise agreement.
Prospective franchisees should carefully review the de-identification requirements outlined in the Franchise Agreement and Brand Standards manual to fully understand their obligations. It is also advisable to consult with legal counsel to ensure compliance and avoid potential penalties.