Does Sonesta Simply Suites owe any fiduciary obligation for administering the brand promotion program?
Sonesta_Simply_Suites Franchise · 2025 FDDAnswer from 2025 FDD Document
The brand promotion programs are not a trust and the Brand Promotion Fees do not bear interest. We do not owe any fiduciary obligation to you for administering the brand promotion program or any other reason. We or our affiliates will use Brand Promotion Fees for the purposes described in this Section 9.A. Our spending of the Brand Promotion Fees in any fiscal year may be more or less than the total Brand Promotion Fee payments in that year, and the brand promotion programs may borrow from us or others (paying reasonable interest) to cover deficits, or invest any surplus for future use. We may prepare an annual, unaudited statement of Brand Promotion Fee payments and expenses, and give you a copy of the most recently prepared statement upon your written request to us. We may (but are not obligated to) have our accounts related to Brand Promotion Fees audited annually, which audit may be paid for using Brand
Source: Item 22 — CONTRACTS (FDD pages 79–80)
What This Means (2025 FDD)
According to Sonesta Simply Suites's 2025 Franchise Disclosure Document, Sonesta Simply Suites does not owe any fiduciary obligation to franchisees for administering the brand promotion program or for any other reason. The document specifies that the brand promotion programs are not a trust, and the Brand Promotion Fees do not bear interest. Sonesta Simply Suites or its affiliates will use Brand Promotion Fees for purposes described in Section 9.A of the FDD.
Sonesta Simply Suites may use Brand Promotion Fees to cover various expenses related to managing and administering the brand promotion programs, including salaries, benefits, administrative costs, travel expenses, meeting costs, and overhead. These fees can also be used for market research, public relations, advertising, and marketing materials.
Sonesta Simply Suites's spending of Brand Promotion Fees in any fiscal year may be more or less than the total payments received that year. The brand promotion programs may borrow funds or invest any surplus for future use. While Sonesta Simply Suites may prepare an annual, unaudited statement of Brand Promotion Fee payments and expenses, they are not obligated to do so unless a franchisee makes a written request. Sonesta Simply Suites may also choose to have their accounts related to Brand Promotion Fees audited annually by an independent certified public accountant, with the audit paid for using collected Brand Promotion Fees.