Under the Embassy Suites agreement, what does 'Trade Restrictions' mean in relation to the lender?

According to Embassy Suites' 2025 Franchise Disclosure Document, 'Trade Restrictions' are defined within the context of a lender's certification to the franchisor. Specifically, the lender must certify that they are not a 'Sanctioned Person.' A 'Sanctioned Person' is any entity or government subject to trade restrictions that would prohibit or restrict the parties' ability to fulfill their obligations under the agreement.

'Trade Restrictions' encompass a range of measures, including trade, economic, or investment sanctions, export controls, anti-terrorism measures, nonproliferation efforts, and anti-money laundering regulations. These restrictions are imposed under laws, rules, and regulations to which the parties are subject. This definition ensures that Embassy Suites does not engage with lenders who may be in violation of international or domestic laws, which could expose the franchise system to legal and reputational risks.

For a prospective Embassy Suites franchisee, this clause means that the lender providing financing for their hotel project must comply with all applicable trade laws and regulations. The lender's compliance is crucial, as any violation could potentially impact the franchisee's ability to operate the hotel or maintain a relationship with Embassy Suites. This requirement adds a layer of due diligence for franchisees when selecting a lender, ensuring that the financial institution is reputable and compliant with relevant laws.