What is the relationship between the Franchise Agreement and the release agreement for Sonesta Select Sonesta Essential?
Sonesta_Select_Sonesta_Essential Franchise · 2025 FDDAnswer from 2025 FDD Document
| Sonesta RL Hotels Franchising Inc. ("we," "us," or "our") and the undersigned franchisee, |
|---|
| ("you" or "your"), currently are parties to a certain Franchise Agreement (the "Franchise |
| Agreement") dated |
| , |
| . You have asked us to take the following action |
| or to agree to the following request: [insert as appropriate] |
| We have the right |
| under the Franchise Agreement to obtain a general release from you (and, if applicable, your owners) as a |
| condition of taking this action or agreeing to this request. Therefore, we are willing to take the action or |
| agree to the request specified above if you (and, if applicable, your owners) give us the release and |
| covenant not to sue provided below in this document. You (and, if applicable, your owners) are willing to |
| give us the release and covenant not to sue provided below as partial consideration for our willingness to |
Source: Item 23 — RECEIPTS (FDD pages 84–261)
What This Means (2025 FDD)
According to the 2025 Franchise Disclosure Document, Sonesta Select Sonesta Essential sometimes requires a release agreement as part of the franchise relationship. Sonesta Select Sonesta Essential may require a franchisee to sign a release and covenant not to sue as a condition of taking a particular action or agreeing to a franchisee's request. This means that if a franchisee wants Sonesta Select Sonesta Essential to make an exception or grant a favor, they may have to sign away their right to sue the company. The release extends to Sonesta Select Sonesta Essential and its parents, subsidiaries, affiliates, owners, officers, directors, employees, managers, agents, representatives, predecessors, successors, and assigns.
The release covers all claims, demands, causes of action, suits, duties, obligations, actions, liabilities, defenses, or damages, whether known or unknown, that the franchisee has or may have against Sonesta Select Sonesta Essential. This includes claims arising out of or relating to the Franchise Agreement, the relationship created by the Franchise Agreement, or the development, ownership, or operation of the franchisee's hotel. The franchisee also agrees not to sue Sonesta Select Sonesta Essential on any of the released claims and warrants that they have not assigned or transferred any of these claims. Owners may also be required to sign a release and covenant not to sue.
However, certain states, such as Maryland and Minnesota, have laws that may limit the scope of these releases. For example, in Maryland, any release required as a condition of renewal or assignment/transfer will not apply to claims arising under the Maryland Franchise Registration and Disclosure Law. Similarly, in Minnesota, any release required as a condition of renewal or assignment/transfer will not apply to the extent prohibited by the Minnesota Franchises Law. Franchisees in these states should be aware that their rights may be protected by state law, notwithstanding the release agreement.
The FDD also includes specific acknowledgments for franchisees in California, emphasizing that they are intentionally waiving their rights to unknown claims against Sonesta Select Sonesta Essential. It is essential for franchisees to consult with legal counsel before signing any release to fully understand its implications and how it affects their rights, especially in light of state-specific protections.