Can Sonesta Simply Suites require a franchisee's employees to execute a non-disclosure agreement?
Sonesta_Simply_Suites 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.
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 reserves the right to require that a franchisee's employees, agents, or independent contractors execute a non-disclosure agreement to protect confidential information. This means that as a franchisee, you may be obligated to ensure your staff and contractors sign these agreements if Sonesta Simply Suites requires it. Sonesta Simply Suites also retains the right to regulate the form of the non-disclosure agreement and to be a third-party beneficiary with independent enforcement rights.
This requirement is tied to the confidential information that Sonesta Simply Suites shares with its franchisees. This information, whether provided orally or in writing, is deemed proprietary and must be held in strict confidence. Franchisees are responsible for preventing unauthorized access, use, or disclosure of this information by implementing reasonable security measures and restricting disclosure to key personnel who have a need to know and are under a similar duty of confidentiality.
The FDD also states that Sonesta Simply Suites acknowledges that the enforceability of any non-disclosure agreement they require may vary by jurisdiction. The franchisee is solely responsible for seeking professional advice to ensure the adequacy of the terms and provisions of any confidentiality agreement used with their employees, agents, and independent contractors. This places the onus on the franchisee to ensure compliance with local laws and regulations regarding non-disclosure agreements.
Overall, this clause protects Sonesta Simply Suites's confidential information and trade secrets, while also placing responsibility on the franchisee to manage and enforce these confidentiality obligations within their own staff and operations. Prospective franchisees should consult with legal counsel to understand the implications of these requirements and ensure they can comply with them.