Is Sonesta Select Sonesta Essential a third-party beneficiary of the non-disclosure agreements that franchisees use?
Sonesta_Select_Sonesta_Essential Franchise · 2025 FDDAnswer from 2025 FDD Document
All Confidential Information furnished to you by us or on our behalf, whether orally or by means of written material (i) shall be deemed proprietary, (ii) shall be held by you in strict confidence, (iii) shall not be copied, disclosed or revealed to or shared with any other person except to your employees or contractors who have a need to know such Confidential Information for purposes of this Agreement and who are under a duty of confidentiality no less restrictive than your obligations hereunder, or to individuals or entities specifically authorized by us in advance, and (iv) shall not be used in connection with any other business or capacity. You will not acquire any interest in any of our Confidential Information other than the right to use it as we specify in operating your Hotel during the Term. You agree to adopt and implement reasonable procedures to prevent unauthorized access, use, or disclosure of Confidential Information, including by establishing reasonable security and access measures and restricting its disclosure to key personnel. We reserve the right to require that any employee, agent, or independent contractor that you hire execute a non-disclosure agreement to protect the Confidential Information. We reserve the right to regulate the form of non-disclosure agreement that you use and to be a third-party beneficiary of those agreements with independent enforcement rights. You acknowledge that any form of non-disclosure agreement that we require you to use, provide to you, or regulate the terms of, may or may not be enforceable in a particular jurisdiction. You agree that you are solely responsible for obtaining your own professional advice with respect to the adequacy of the terms and provisions of any confidentiality agreement that your employees, agents, and independent contractors sign.
Confidential Information does not include Restricted Data (as defined in Section 8.M), nor does it include information, knowledge, or know-how which you can demonstrate lawfully came to your attention before we provided it to you directly or indirectly; which, at the time we disclosed it to you, already had lawfully become generally known through publication or communication by others (without violating an obligation to us or our affiliates); or which, after we disclose it to you, lawfully becomes generally known through publication or communication by others (without violating an obligation to us or our affiliates). However, if we include any matter in Confidential Information, anyone who claims that it is not Confidential Information must prove that one of the exclusions provided in this paragraph is fulfilled.
Source: Item 22 — CONTRACTS (FDD page 84)
What This Means (2025 FDD)
According to the 2025 Franchise Disclosure Document, Sonesta Select Sonesta Essential has the right to be a third-party beneficiary of the non-disclosure agreements that franchisees establish with their employees, agents, or independent contractors. Sonesta Select Sonesta Essential also reserves the right to regulate the form of the non-disclosure agreement that franchisees use. This means Sonesta Select Sonesta Essential can directly enforce these agreements to protect its confidential information.
As a franchisee, you are responsible for adopting and implementing reasonable procedures to prevent unauthorized access, use, or disclosure of confidential information. This includes establishing security measures and restricting disclosure to key personnel. You must ensure that your employees and contractors who have access to confidential information are under a duty of confidentiality that is no less restrictive than your own obligations under the franchise agreement.
However, the FDD also acknowledges that the enforceability of any non-disclosure agreement that Sonesta Select Sonesta Essential requires you to use or regulates the terms of may vary by jurisdiction. Therefore, as a franchisee, you are solely responsible for seeking professional advice to ensure the adequacy of the terms and provisions of any confidentiality agreement used with your employees, agents, and independent contractors. This highlights the importance of consulting with legal counsel to ensure compliance with local laws and regulations regarding non-disclosure agreements.
Confidential Information excludes Restricted Data and information that you can demonstrate lawfully came to your attention before Sonesta Select Sonesta Essential provided it to you, or that was already generally known, or that lawfully becomes generally known after disclosure. However, the burden of proof lies on anyone claiming that certain information is not Confidential Information to demonstrate that one of these exclusions applies.