Is a gift of interest in the Sonesta Simply Suites franchise considered a transfer?

According to the 2025 Sonesta Simply Suites Franchise Disclosure Document, a gift of an interest in the franchise is considered a transfer. Sonesta Simply Suites requires franchisees to obtain prior written approval from them for any transfer of interest. This requirement ensures that the brand maintains control over who becomes a franchisee and protects the standards of the franchise system.

The term "transfer" is broadly defined in the franchise agreement to include any voluntary, involuntary, direct, or indirect assignment, sale, gift, or other disposition of any interest in the franchise agreement itself, the franchisee entity, the hotel or its assets, or the owners of the franchisee entity. This broad definition captures various scenarios where ownership or control of the franchise changes hands.

Specifically, the FDD lists a "gift" as one of the events included in the definition of a transfer. This means that if a franchisee wishes to gift any portion of their ownership interest in the Sonesta Simply Suites franchise, they must first obtain approval from Sonesta Simply Suites. This provision is in place to allow Sonesta Simply Suites to assess the qualifications and suitability of the recipient of the gift, ensuring they meet the brand's standards for franchisees. The brand also wants to protect its investment in the franchise system by ensuring that new owners are capable of maintaining the standards and reputation of the Sonesta Simply Suites brand.

Any transfer or attempt to transfer without Sonesta Simply Suites's approval constitutes a breach of the franchise agreement and is considered to have no effect. This underscores the importance of adhering to the transfer requirements outlined in the FDD to avoid potential legal and financial repercussions.