Under the Atwell Suites agreement, what constitutes an 'Affiliate'?
Atwell_Suites Franchise · 2025 FDDAnswer from 2025 FDD Document
In the event IHG terminates this License due to Licensee's breach of any of its obligations under the License prior to the time that Licensee is authorized to use the Brand System at the Hotel, Licensee
shall pay to IHG, as liquidated damages, a lump sum equal to the monthly average of all amounts that would have been payable to IHG under paragraphs 3.B.(3) through 3.B.(6) of this License assuming the Hotel had collected Gross Suites Revenue based on the average daily revenue per available room for all "mature hotels" in the Brand System or operating under one of IHG's "All Suite brands" (as hereinafter defined) in the United States for the previous twelve (12) months, as determined by IHG, multiplied by the greater of (a) six (6) or (b) the number of full and partial months from the Effective Date to the termination date of this License. For purposes of this paragraph, "mature hotels" means hotels which were open for two full years or longer; were franchised or, alternatively, owned and/or managed by IHG or one of its Affiliates; and, were not in default of their applicable franchise or management agreement obligations as of the applicable date. For purposes of this paragraph, IHG's "All Suite brands" means Staybridge Suites, Candlewood Suites or Atwell Suites.
IHG and Licensee acknowledge and agree that it would be difficult to determine the injury caused to IHG by termination of this License. IHG and Licensee therefore intend and agree the above liquidated damages calculations to be a reasonable pre-estimate of IHG's probable loss and not as a penalty or in lieu of any other payment.
K. Reimbursement of Expenses.
Licensee agrees to pay IHG all expenses, including reasonable attorneys' fees and court costs, incurred by IHG, its Affiliates, and their successors and assigns to remedy any defaults of or enforce or defend
Source: Item 23 — Receipts (FDD pages 99–486)
What This Means (2025 FDD)
I am unable to provide a definition of 'Affiliate' for Atwell Suites, according to the 2025 Franchise Disclosure Document. While the term 'Affiliates' is mentioned in the context of amendments to the license agreement and in relation to expenses and liquidated damages, a specific definition is not provided in the included excerpts.
Specifically, the term appears in discussions regarding IHG's (InterContinental Hotels Group) obligations, such as indemnifying Minnesota licensees against trademark infringement claims and in the calculation of liquidated damages if the license is terminated early. In the case of early termination, the calculation involves considering revenue from hotels owned or managed by IHG or one of its Affiliates.
To fully understand the scope and implications of the term 'Affiliate' within the Atwell Suites franchise agreement, prospective franchisees should seek clarification from the franchisor. Understanding this definition is crucial, as it can impact various aspects of the franchise relationship, including liability, financial obligations, and the competitive landscape.