Does the Rider to the Sonesta Select Sonesta Essential franchise agreement require any actions by the franchisee?
Sonesta_Select_Sonesta_Essential Franchise · 2025 FDDAnswer from 2025 FDD Document
| THIS RIDER is by and between SONESTA RL HOTELS FRANCHISING INC. a Washington |
|---|
| corporation with its principal business address at 400 Centre Street, Newton, Massachusetts 02458 ("we," |
| "us," or "our"), and |
| , whose |
| principal business address is |
| ("you" or "your"). |
| 1. |
| BACKGROUND. We and you are parties to that certain Franchise Agreement dated |
| (the "Franchise Agreement") that has been signed concurrently |
| with the signing of this Rider. This Rider is annexed to and forms part of the Franchise Agreement. This |
| Rider is being signed because (a) Franchisee is domiciled in the State of Washington; and/or (b) the Hotel |
| that Franchisee will operate under the Franchise Agreement will be located in Washington; and/or (c) any |
| of the offering or sales activity relating to the Franchise Agreement occurred in Washington. |
Source: Item 23 — RECEIPTS (FDD pages 84–261)
What This Means (2025 FDD)
According to the 2025 Franchise Disclosure Document, the Rider to the Sonesta Select Sonesta Essential franchise agreement outlines several actions and considerations for the franchisee, particularly concerning legal and operational aspects within specific states. For instance, franchisees in certain states such as Maryland, Minnesota, North Dakota, and Washington are subject to state-specific addenda that modify the standard franchise agreement. These modifications address issues like waivers of punitive damages, injunctive relief, limitations of claims, and governing law, ensuring compliance with local franchise laws. Franchisees need to understand these state-specific stipulations as they can significantly impact their rights and obligations.
In Maryland, for example, the Rider clarifies that acknowledgments or representations made by the franchisee do not act as a waiver of liability under the Maryland Franchise Registration and Disclosure Law. Additionally, releases required for renewal or assignment/transfer will not apply to claims arising under this law. This protects the franchisee's rights under Maryland law, preventing them from inadvertently relinquishing legal protections. Similarly, the Rider addresses governing law and consent to jurisdiction, ensuring that Maryland law applies to claims arising under the Maryland Franchise Registration and Disclosure Law, and allowing franchisees to bring actions in Maryland for such claims.
For franchisees in Washington, the Rider emphasizes that any provisions prohibiting communication with regulators are unlawful. It also advises franchisees working with franchise brokers to carefully evaluate the information provided. Furthermore, any restrictions on soliciting or hiring employees of other franchisees or the franchisor are void and unenforceable in Washington. These provisions aim to protect franchisees' rights to communicate with regulatory bodies and to ensure fair labor practices.
Overall, the Rider to the Sonesta Select Sonesta Essential franchise agreement requires franchisees to be aware of and comply with state-specific regulations and modifications to the standard agreement. These adjustments are crucial for ensuring that franchisees understand their rights and obligations under local laws, and for maintaining compliance with state franchise regulations. Prospective franchisees should carefully review the Rider applicable to their state and seek legal counsel to fully understand its implications.