How much is the transfer fee for a Sonesta Simply Suites franchise, and where is it defined in the agreement?
Sonesta_Simply_Suites Franchise · 2025 FDDAnswer from 2025 FDD Document
- (10) you or the transferee pays us a transfer fee equal to the Initial Fee, as provided in Section 3.A of this Agreement. However, no transfer fee is due if, upon a spouse's death, that spouse's interest in this Agreement and your Hotel, or ownership in you, is transferred to the surviving spouse, provided that such transfer is subject to the terms and conditions of this Section 12;
- (11) you (and your transferring owners) sign a general release, in a form satisfactory to us, of any and all claims against us and our affiliates and our and their owners, officers, directors, employees, and agents;
- (12) you and your owners agree that all the transferee's obligations under promissory notes, agreements, or security interests reserved in your Hotel are subordinate to the transferee's obligation to pay Royalty, Brand Promotion Fees, and other amounts due to us, our affiliates, and third-party vendors and otherwise to comply with this Agreement; and
- (13) you and your transferring owners will not directly or indirectly at any time or in any manner (except with respect to other Network Hotels you own and operate) identify yourself or themselves or any business as a current or former Hotel or as one of our franchisees; use any Mark, any colorable imitation of a Mark, or other indicia of a Brand Hotel in any manner or for any purpose; or utilize for any purpose any trade name, trade or service mark, or other commercial symbol that suggests or indicates a connection or association with us.
Source: Item 22 — CONTRACTS (FDD pages 79–80)
What This Means (2025 FDD)
According to Sonesta Simply Suites's 2025 Franchise Disclosure Document, a franchisee who wishes to transfer their franchise must pay a transfer fee. This fee is equal to the initial franchise fee, as detailed in Section 3.A of the Franchise Agreement.
However, there is an exception to this transfer fee. If a spouse who owns an interest in the franchise passes away, their interest can be transferred to the surviving spouse without incurring the transfer fee. This waiver is contingent upon the transfer adhering to the terms and conditions outlined in Section 12 of the agreement.
In addition to the transfer fee, the potential new franchisee must meet several conditions to be approved. They must meet Sonesta Simply Suites's current standards for new franchisees, including educational, managerial, and business standards. The new franchisee must also have a good moral character, business reputation, and credit rating, as well as the aptitude and ability to operate the hotel, and sufficient equity capital.