factual

What are the 'Management Company Documents' in the context of a Caption By Hyatt franchise?

Caption_By_Hyatt Franchise · 2025 FDD

Answer from 2025 FDD Document

  • (b) Management Company Documents. As a condition of Hyatt's approval of any Management Company, the Management Company must (i) sign the documents Hyatt requires to protect its intellectual property rights and to reflect the Management Company's agreement to perform its management responsibilities and otherwise operate the Hotel in compliance with this Agreement (collectively, the "Management Company Documents"); and (ii) attend and successfully complete Hyatt's designated then current operator training programs for Brand Hotels, if any. The current version of the Management Company Documents is attached as Exhibit F. Hyatt may refuse to approve a Management Company that is a Competing Brand Owner. If Hyatt has approved a Management Company as of the Effective Date, or if Hyatt has approved Franchisee to manage the Hotel as of the Effective Date, then the approved Management Company (if applicable) is listed on Exhibit B-1.

EXHIBIT F to the BRAND HOTEL FRANCHISE AGREEMENT

MANAGEMENT COMPANY DOCUMENTS

MANAGEMENT COMPANY RIDER

to the Franchise Agreement dated as of, 2025 ("Franchise Agreement") between ("Hyatt") and ("Franchisee") ("Management Company") has entered into a Management Agreement with Franchisee (as amended, the "Management Agreement") under which Management Company will operate the Brand Hotel located at (the "Hotel") in accordance with the terms and conditions of the Franchise Agreement. However, under the Franchise Agreement, Management Company may not operate the Hotel without Hyatt's consent, and Hyatt is unwilling to provide such consent unless Franchisee and Management Company agree to the terms of this Rider. In consideration of the rights granted to Management Company under the Management Agreement and of Hyatt's consent (under the Franchise Agreement) to Management Company's operation of the Hotel, Management Company hereby acknowledges and ratifies the terms and conditions of the Franchise Agreement and agrees to fully observe and be bound by all terms, conditions and restrictions regarding the management and operation of the Hotel set forth in the Franchise Agreement for as long as Management Company operates the Hotel, as if and as though Management Company had executed the Franchise Agreement as "Franchisee," including, without limitation, all terms and conditions of ARTICLE IV and ARTICLE V of the Franchise Agreement (other than Section 4.2(a)). Management Company further agrees to be bound by the confidentiality and other covenants set forth in Sections 11.5, 11.6, and 11.7 of the Franchise Agreement (including all remedies available to Hyatt under the Franchise Agreement for breach thereof) during and subsequent to its tenure as manager of the Hotel. However, notwithstanding the foregoing, nothing in this Rider constitutes an agreement of Management Company: (a) to pay or assume any financial obligation of Franchisee to Hyatt or to any third party, including any obligation of Franchisee to pay Royalty Fees or System Services Charges or any liquidated damages pursuant to Section 16.5 of the Franchise Agreement; or (b) to be bound by any provision in ARTICLE XII of the Franchise Agreement. Management Company represents and warrants to Hyatt and Franchisee that Management Company is not a Competing Brand Owner, as defined in the Franchise Agreement.

Management Company agrees that Hyatt may enforce directly against Management Company those terms and conditions of the Franchise Agreement to which Management Company has hereby agreed to be bound. Franchisee acknowledges and agrees that any act or omission of Management Company relating directly or indirectly to the Hotel will be deemed and considered the act or omission of Franchisee for purposes of Hyatt's rights and remedies under the Franchise Agreement (including, without limitation, Franchisee's indemnification and defense obligations under Section 8.3 of the Franchise Agreement), any other agreement, or applicable law. ARTICLE VIII, ARTICLE XIV (including, without limitation, the arbitration provisions) and ARTICLE XVIII of the Franchise Agreement, entitled "Relationship of Parties and Indemnification," "Dispute Resolution," and "General," respectively, are incorporated by reference in this Rider and will govern all aspects of Hyatt's and Management Company's relationship and this Rider as if fully restated within the text of this Rider, with all references to "Franchisee" interpreted as references to Management Company.

Source: Item 22 — Contracts (FDD page 85)

What This Means (2025 FDD)

According to Caption By Hyatt's 2025 Franchise Disclosure Document, the 'Management Company Documents' are those that a Management Company must sign as a condition of Hyatt's approval. These documents protect Hyatt's intellectual property rights and ensure the Management Company agrees to perform its management responsibilities and operate the hotel in compliance with the Franchise Agreement. The current version of these documents is included as Exhibit F in the Franchise Agreement.

Exhibit F, titled 'Management Company Documents,' includes a 'Management Company Rider' to the Franchise Agreement. This rider stipulates that the Management Company acknowledges and ratifies the terms and conditions of the Franchise Agreement and agrees to be bound by all terms, conditions, and restrictions regarding the management and operation of the hotel. This obligation remains in effect as long as the Management Company operates the hotel, as if the Management Company had executed the Franchise Agreement as the 'Franchisee.'

However, the Management Company Rider specifies certain limitations. The Management Company is not obligated to pay or assume any financial obligation of the Franchisee to Hyatt or any third party, including Royalty Fees, System Services Charges, or liquidated damages. Additionally, the Management Company is not bound by any provision in Article XII of the Franchise Agreement. The Management Company also represents and warrants to Hyatt and the Franchisee that it is not a Competing Brand Owner, as defined in the Franchise Agreement.

The rider also states that Hyatt can directly enforce the terms and conditions of the Franchise Agreement against the Management Company. Furthermore, any action or omission by the Management Company related to the hotel is considered the act or omission of the Franchisee for the purposes of Hyatt's rights and remedies under the Franchise Agreement. Articles VIII, XIV, and XVIII of the Franchise Agreement, which cover 'Relationship of Parties and Indemnification,' 'Dispute Resolution,' and 'General' matters, respectively, are incorporated by reference into the rider and govern the relationship between Hyatt and the Management Company.

Disclaimer: This information is extracted from the 2025 Franchise Disclosure Document and is provided for research purposes only. It does not constitute legal or financial advice. Consult with a franchise attorney before making any investment decisions.