Ramada could lose franchise

Published 12:00 am Thursday, December 9, 2004

NATCHEZ &045; Ramada Franchise Systems has filed papers in U.S. Bankruptcy Court seeking to end its license agreement with Natchez’s Ramada Inn Hilltop.

According to the request, Ramada Franchise Systems is seeking to require the local hotel to cease and desist from using Ramada logos, signs and other materials identifying it with the national chain. Charisma Corp., which operates the local hotel, filed for bankruptcy protection in September.

The latest licensing agreement with Ramada Franchise Systems is dated July 21, 1999.

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RFS does not operate hotels but instead provides &uot;certain standards, advertising and centralized support functions, including a nationwide computer reservation system,&uot; according to the filing.

Local Ramada co-owner Scott Swinney said he had no comment about the RFS request.

The hotel is still open right now, but Swinney had no comment when asked if the hotel would remain open.

According to the motion filed with the court, Charisma Corp. before the bankruptcy petition owed RFS $147,756 in past-due fees for its licensing agreement.

Since the bankruptcy filing, &uot;the debtor has continued to enjoy the benefits of the license agreements but has paid no compensation to RFS,&uot; according to the motion.

As of Nov. 15, RFS said, Charisma owned $25,013 in license agreement fees.

The failure to pay &uot;constitutes a breach of the license agreement,&uot; RFS said in its filing.

RFS attorney Alan L. Smith could not be reached for comment Tuesday.

The motion also asks that RFS be allowed to inspect the hotel premises to verify the &uot;de-identification&uot; with the national chain.

In recent months, the Ramada was in negotiations with Charles Cato, a developer planning to put a casino along the river south of the bridge, below the hotel. Those talks fell through earlier this year.