Does Sonesta Select Sonesta Essential specify if the franchisee can appeal a notice of default?
Sonesta_Select_Sonesta_Essential Franchise · 2025 FDDAnswer from 2025 FDD Document
r owners' failure to sign these agreements and releases and to deliver them to us for acceptance and execution (together with
the renewal fee) within 30 days after their delivery to you to be an election not to acquire a successor franchise.
14. TERMINATION OR SUSPENSION OF AGREEMENT.
- A. Termination or Suspension by Us on Advance Notice. Except in the case of an immediate termination as provided in Section 14.B below, we have the right to terminate this Agreement if you fail to cure an Event of Default within 30 days after we furnish notice of default to you based on the Event of Default, or, if there is a non-monetary Event of Default that is incapable of cure within 30 days, if you fail to diligently pursue cure of such default and fail to cure the default within the additional time periods we set forth in the notice of default.
- (1) An "Event of Default" will occur if you fail to satisfy or comply with any of the obligations, requirements, conditions, or terms set forth in (i) this Agreement, the Brand Standards (including the minimum performance scores required by the Brand Manual), or any attachment to this Agreement; or (ii) any other agreement you have with us, or an Entity, relating to your Hotel, including, any computer system agreement, or any agreement to manage your Hotel. An "Event of Default" will also occur if you make any misrepresentations to us, whether in entering into this Agreement, or in the performance of your obligations to us.
- (2) Our notice of termination will not relieve you of your obligations under this Agreement or any of its attachments.
- (3) Upon notice of an Event of Default, we also may at any time, at our sole discretion, suspend our obligations under this Agreement (including Central Reservation Services as more fully described below) and may remove the listing of your Hotel from any directories we publish, and from any advertising we publish, or to remove or suspend you from the Central Reservation System immediately without notice to you, and/or rescind any terms to this Agreement that were negotiated between the parties.
Source: Item 22 — CONTRACTS (FDD page 84)
What This Means (2025 FDD)
The 2025 Franchise Disclosure Document for Sonesta Select Sonesta Essential does not explicitly state whether a franchisee has the right to appeal a notice of default. However, it does outline the conditions under which Sonesta Select Sonesta Essential can terminate the agreement if the franchisee fails to address the default within a specified timeframe. Specifically, Sonesta Select Sonesta Essential can terminate the agreement if a franchisee fails to cure an Event of Default within 30 days after receiving notice. If the default is non-monetary and cannot be cured within 30 days, the franchisee must diligently pursue a cure within the additional time periods set forth by Sonesta Select Sonesta Essential in the notice of default.
Additionally, upon notice of an Event of Default, Sonesta Select Sonesta Essential has the right to suspend its obligations under the agreement, including Central Reservation Services, and may remove the hotel's listing from directories and advertising. Sonesta Select Sonesta Essential can also divert reservations to other Network Hotels after providing notice of the Event of Default. If the franchisee cures the default within the given time, including payments and an administrative fee, Sonesta Select Sonesta Essential will restore services, but is not required to redirect previously diverted reservations.
Since the FDD does not explicitly address the franchisee's right to appeal a notice of default, prospective franchisees should seek clarification from Sonesta Select Sonesta Essential regarding the process for disputing a notice of default, the mechanisms available for resolving disputes related to default notices, and any historical precedents or company policies related to appealing such notices.