How is 'Control' defined in the Embassy Suites franchise agreement?
Embassy_Suites Franchise · 2025 FDDAnswer from 2025 FDD Document
The following capitalized terms will have the meanings set forth after each term:
- "Affiliate" means any natural person or firm, corporation, partnership, limited liability company, association, trust or other entity which, directly or indirectly, Controls, is Controlled by, or is under common Control with, the subject entity.
Source: Item 22 — CONTRACTS (FDD page 97)
What This Means (2025 FDD)
According to Embassy Suites's 2025 Franchise Disclosure Document, the term "Control" is used in the definition of "Affiliate." An Affiliate is defined as any entity that directly or indirectly Controls, is Controlled by, or is under common Control with the subject entity. However, the term 'Control' itself is not explicitly defined within the provided excerpts of the franchise agreement.
Without a clear definition of 'Control,' prospective Embassy Suites franchisees should seek clarification from the franchisor regarding what constitutes 'Control' in the context of the franchise agreement. Understanding this term is crucial because it affects the scope of who is considered an 'Affiliate,' which in turn can have implications for various aspects of the franchise relationship, including transfers, competitive restrictions, and financial obligations.
To gain a comprehensive understanding, prospective franchisees should ask Embassy Suites for specific examples or scenarios that would constitute 'Control.' This will help them assess potential conflicts of interest, ensure compliance with the franchise agreement, and make informed decisions about their investment. It is essential to clarify this term before signing the franchise agreement to avoid potential disputes or misunderstandings in the future.