What constitutes a 'Flag Change' that would automatically terminate the Caption By Hyatt agreement?

According to Caption By Hyatt's 2025 Franchise Disclosure Document, a 'Flag Change' will automatically terminate the agreement between Hyatt and the Owner. A 'Flag Change' is defined as the termination of Hyatt's franchise relationship with the Owner. It also includes any change that results in the property no longer being under a management, franchise, or similar agreement with a direct or indirect subsidiary of Hyatt Hotels Corporation.

For a prospective Caption By Hyatt franchisee, this means that if the franchise relationship with Hyatt is terminated, or if the hotel ceases to be managed or franchised by Hyatt or one of its subsidiaries, the agreement is automatically terminated. This could occur if the franchisee decides to switch to a different hotel brand or management company, or if Hyatt decides to terminate the franchise agreement.

This provision is important because it clarifies the circumstances under which the agreement will automatically end, regardless of any other terms or conditions. It protects Hyatt's brand and ensures that properties operating under the Caption By Hyatt name adhere to Hyatt's standards and maintain a relationship with Hyatt or its affiliates. Franchisees need to be aware of this clause, as any action leading to a 'Flag Change' will result in the immediate termination of the agreement.