What agreement is the Caption By Hyatt Guaranty and Assumption of Obligations directly related to?
Caption_By_Hyatt Franchise · 2025 FDDAnswer from 2025 FDD Document
WHEREAS, simultaneously herewith, Franchisee is entering into a Brand Hotel Franchise Agreement (as amended, modified or amended and restated from time to time, the "Franchise Agreement") with Hyatt with respect to the Hotel;
WHEREAS, Guarantor is either an owner (whether direct or indirect) of Franchisee or otherwise has a direct or indirect relationship with Franchisee or its affiliates, Guarantor will benefit significantly from Hyatt's entering into the Franchise Agreement with Franchisee, and Hyatt will not enter into the Franchise Agreement unless each of the undersigned agrees to sign and comply with the terms of this Guaranty;
WHEREAS, as a condition to entering into the Franchise Agreement, Hyatt has required that Guarantor guarantee the payment and performance of the Guaranteed Obligations (as defined herein), subject to the terms of this Guaranty.
Franchisee must ensure that one or more of the Controlling Owners which Hyatt specifies as of the Effective Date signs Hyatt's Guaranty and Assumption of Obligations (the "Guaranty"), the current form of which is attached as Exhibit H.
Franchisee represents and warrants that at least one Guarantor satisfies the Guarantor Monetary Threshold as of the Effective Date, and Franchisee agrees to ensure that at least one Guarantor continues to satisfy the Guarantor Monetary Threshold (as it may be increased in accordance with Exhibit B-1) at all times during the Term.
Source: Item 22 — Contracts (FDD page 85)
What This Means (2025 FDD)
According to Caption By Hyatt's 2025 Franchise Disclosure Document, the Guaranty and Assumption of Obligations is directly related to the Brand Hotel Franchise Agreement. Specifically, the document states that the franchisee is entering into a Brand Hotel Franchise Agreement with Hyatt, and as a condition, Hyatt requires a guarantor to ensure the franchisee meets their obligations.
The guarantor, who typically has an ownership or affiliate relationship with the franchisee, benefits from Hyatt entering into the Franchise Agreement. Hyatt requires the guarantor to sign the Guaranty and Assumption of Obligations to ensure compliance with its terms.
Furthermore, the Franchise Disclosure Document includes Exhibit H, which is the current form of Hyatt's Guaranty and Assumption of Obligations. The franchisee must ensure that one or more controlling owners sign this guaranty. The guarantor must also meet a certain monetary threshold, which must be maintained throughout the term of the agreement. This threshold may be increased according to Exhibit B-1.