Are there any exceptions to the exclusivity of benefit in the Embassy Suites franchise agreement regarding affiliates?
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 Embassy Suites's 2025 Franchise Disclosure Document, the franchise agreement is primarily for the benefit of the franchisee and Embassy Suites. However, there are specific exceptions regarding affiliates. While the obligations outlined in the agreement generally do not extend to or are enforceable by other parties, Embassy Suites retains the right to assign or delegate rights to its affiliates.
Specifically, any rights that Embassy Suites assigns or delegates to its affiliates, as well as any covenants established in favor of its affiliates, will extend to and be enforceable by those affiliates, including their successors and assigns. This means that while third parties typically cannot enforce the agreement, Embassy Suites's affiliates have the right to enforce rights and covenants specifically assigned to them.
This clause ensures that Embassy Suites can involve its affiliates in the franchise operation and that these affiliates have the legal standing to enforce aspects of the agreement that pertain to them. Prospective franchisees should understand that while the agreement is primarily between them and Embassy Suites, the rights of Embassy Suites's affiliates are also protected under the agreement.