Does the Embassy Suites franchise agreement provide benefits to any third parties?
Embassy_Suites Franchise · 2025 FDDAnswer from 2025 FDD Document
- 16.3 Exclusive Benefit. This Agreement is exclusively for our and your benefit, and none of the obligations of you or us in this Agreement will run to, or be enforceable by, any other party (except for any rights we assign or delegate to one of our Affiliates or covenants in favor of our Affiliates, which rights and covenants will run to and be enforceable by our Affiliates or their successors and assigns) or give rise to liability to a third party, except as otherwise specifically set forth in this Agreement.
Source: Item 22 — CONTRACTS (FDD page 97)
What This Means (2025 FDD)
According to the 2025 Embassy Suites Franchise Disclosure Document, the franchise agreement is primarily for the benefit of the franchisee and Hilton Franchise Holding LLC, the franchisor. However, there are specific exceptions where affiliates of the franchisor may also benefit from the agreement.
Specifically, the agreement states that the obligations outlined within it do not extend to or are enforceable by any other party. This means that third parties generally cannot claim benefits or enforce the agreement's terms unless explicitly stated otherwise. An exception exists for rights that Embassy Suites assigns or delegates to its affiliates, or covenants made in favor of its affiliates. In these cases, the rights and covenants will extend to and be enforceable by those affiliates or their successors.
This clause ensures that while the core agreement is between the franchisee and franchisor, Embassy Suites retains the flexibility to involve its affiliates and grant them certain rights or benefits under the agreement. This is a fairly standard practice in franchising, as franchisors often operate through complex corporate structures involving multiple affiliated entities.