How does the Embassy Suites By Hilton agreement define 'Sanctioned Person'?
Embassy_Suites_By_Hilton Franchise · 2025 FDDAnswer from 2025 FDD Document
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- Lender Estoppel and Release.
As consideration for this letter agreement relating to the Loan:
- (a) Lender hereby certifies to Franchisor that Lender is not a Sanctioned Person. "Sanctioned Person" means any person, entity, or Government, including those with Control over such persons or entities, or acting on behalf of such persons or entity, who is subject to Trade Restrictions that prohibit or restrict the Parties' performance of the Parties' obligations under this Agreement. "Trade Restrictions" means trade, economic or investment sanctions, export controls, anti-terrorism, nonproliferation, anti-money laundering and similar restrictions in force pursuant to laws, rules and regulations imposed under Laws to which the Parties are subject.
Source: Item 23 — RECEIPTS (FDD pages 97–304)
What This Means (2025 FDD)
According to the 2025 Embassy Suites By Hilton Franchise Disclosure Document, a 'Sanctioned Person' is defined within the context of a letter agreement related to a loan between a lender and a franchisee. Specifically, it appears in a section addressing lender estoppel and release.
The agreement defines a 'Sanctioned Person' as any person, entity, or government, including those with control over such persons or entities, or acting on behalf of such persons or entities, who is subject to 'Trade Restrictions'. 'Trade Restrictions' encompass trade, economic, or investment sanctions, export controls, anti-terrorism measures, nonproliferation efforts, anti-money laundering regulations, and similar restrictions. These restrictions are enforced through laws, rules, and regulations imposed under laws to which the involved parties are subject.
This definition is important because Embassy Suites By Hilton requires the lender to certify that they are not a 'Sanctioned Person' as a condition of the letter agreement. This clause protects Embassy Suites By Hilton from potential legal or reputational risks associated with doing business with entities or individuals subject to trade restrictions. For a prospective franchisee, this highlights the importance of ensuring that any lenders they work with meet this requirement to avoid complications with the franchise agreement.