If Sonesta Simply Suites suspends obligations, does the franchisee have the right to terminate the agreement?
Sonesta_Simply_Suites Franchise · 2025 FDDAnswer from 2025 FDD Document
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.
We will have the right to divert reservations previously made for your Hotel to other Network Hotels after giving you notice of an Event of Default.
Source: Item 22 — CONTRACTS (FDD pages 79–80)
What This Means (2025 FDD)
The 2025 Franchise Disclosure Document for Sonesta Simply Suites addresses the circumstances under which Sonesta Simply Suites may suspend its obligations under the franchise agreement. Specifically, if a franchisee is in default, Sonesta Simply Suites has the option to suspend its obligations, which may include services like Central Reservation Services. They can also remove the hotel's listing from directories and advertising, or remove/suspend the franchisee from the Central Reservation System without prior notice. Additionally, Sonesta Simply Suites can redirect reservations made for the franchisee's hotel to other hotels within their network after providing notice of the default.
However, the FDD excerpt does not explicitly state that the franchisee has a reciprocal right to terminate the agreement if Sonesta Simply Suites suspends its obligations. The document focuses on Sonesta Simply Suites's rights and actions following an event of default by the franchisee. The franchisee's recourse in such a situation is not detailed in this section.
Therefore, a prospective Sonesta Simply Suites franchisee should inquire with the franchisor about the specific conditions under which they might be able to terminate the agreement if Sonesta Simply Suites suspends its obligations, and what remedies or options are available to them in such a scenario. Understanding these conditions is crucial for assessing the risks and benefits of investing in a Sonesta Simply Suites franchise.