What was the maximum exposure for indemnification for open tax years for Caption By Hyatt?
Caption_By_Hyatt Franchise · 2025 FDDAnswer from 2025 FDD Document
| discount rates, and expected timing of cash flows, which are primarily Level Three assumptions. At | |
|---|---|
| indemnification for open tax years had a maximum exposure of | $72 million. |
Source: Item 23 — Receipts (FDD pages 85–349)
What This Means (2025 FDD)
According to Caption By Hyatt's 2025 Franchise Disclosure Document, the maximum exposure for indemnification for open tax years was $72 million. This figure represents the potential financial risk Caption By Hyatt faces regarding unresolved tax liabilities for previous years that are still subject to audit and adjustment by tax authorities.
For a prospective Caption By Hyatt franchisee, this information is relevant because it provides insight into the franchisor's financial stability and potential liabilities. While the franchisee is not directly responsible for these liabilities, significant financial exposures at the franchisor level could indirectly impact the brand's resources and support available to franchisees. Understanding the scale of these potential obligations helps franchisees assess the overall risk associated with investing in the Caption By Hyatt franchise system.
It is important to note that this figure represents the maximum exposure, not a guaranteed liability. The actual amount, if any, that Caption By Hyatt may ultimately pay could be lower, or the company may have insurance or other financial mechanisms in place to mitigate this risk. However, the disclosure provides a transparent view of a potential financial obligation that could affect the franchisor.