What material rights are granted to cardholders through the Caption By Hyatt loyalty program?

According to Caption By Hyatt's 2025 Franchise Disclosure Document, the loyalty points and free room nights awarded to cardholders through the co-branded credit card programs represent material rights. These rights can be redeemed in the future for free or discounted services. This is part of Caption By Hyatt's broader strategy to provide system-wide services and administer the loyalty program for the benefit of Hyatt's portfolio of properties.

Caption By Hyatt administers the loyalty program, allowing members to accumulate points based on spending at properties, through the experience platform, or by engaging with strategic loyalty alliances like American Airlines and Peloton. Points can also be earned via spend on World of Hyatt co-branded consumer and business credit cards. These points can then be redeemed for stays at participating properties, as well as for other goods and services from third parties.

For a Caption By Hyatt franchisee, understanding the loyalty program is crucial. The costs of administering the loyalty program are charged to the properties through an assessment fee based on members' qualified expenditures. The assessment fee is billed and collected monthly, and revenues received by the program are deferred until a member redeems points. Upon redemption of points at managed and franchised properties, Caption By Hyatt recognizes the previously deferred revenue in revenues for reimbursed costs, net of redemption expense paid to managed and franchised hotels.

Caption By Hyatt uses observable transaction prices and adjusted market assumptions to determine the standalone selling price of a loyalty point and a cost plus margin approach to determine the standalone selling price of the free room nights. The revenues allocated to loyalty program points and free night awards are deferred and recognized in revenues for reimbursed costs upon redemption or expiration of a card member's promotional awards, net of redemption expense when Caption By Hyatt is the agent.