Does Embassy Suites By Hilton require franchisees to have the legal power to enter into the Agreement?
Embassy_Suites_By_Hilton Franchise · 2025 FDDAnswer from 2025 FDD Document
You further represent and warrant to us that:
16.11.3 you have the full legal power authority and legal right to enter into this Agreement;
16.11.4 this Agreement constitutes a legal, valid and binding obligation and your entry into, performance and observation of this Agreement will not constitute a breach or default of any agreement to which you are a party or of any Law;
16.11.5 if you are a corporation, limited liability company, or other entity, you are, and throughout the Term will be, duly formed and validly existing, in good standing in the state in which you are organized, and are and will be authorized to do business in the state in which the Hotel is located;
16.11.7 you hereby indemnify and hold us harmless from any breach of these representations and warranties, which will survive the termination of this Agreement.
Source: Item 22 — CONTRACTS (FDD page 97)
What This Means (2025 FDD)
According to the 2025 Embassy Suites By Hilton Franchise Disclosure Document, franchisees must possess the legal authority to enter into the Franchise Agreement. Specifically, the franchisee represents and warrants to Embassy Suites By Hilton that they have the full legal power, authority, and right to enter into the agreement.
This requirement ensures that the agreement is legally sound and binding. The franchisee's entry into, performance, and observation of the agreement should not breach or default any other agreement they are party to, or any law. This protects Embassy Suites By Hilton by ensuring the franchisee is not encumbered by conflicting obligations that could impede their ability to fulfill the terms of the franchise agreement.
Furthermore, if the franchisee is a corporation, limited liability company, or other entity, they must be duly formed, validly existing, and in good standing in their state of organization. They must also be authorized to conduct business in the state where the hotel is located. This stipulation aims to ensure the franchisee is a legitimate and legally compliant business entity, reducing the risk of legal complications for Embassy Suites By Hilton.
These representations and warranties made by the franchisee survive the termination of the agreement, and the franchisee agrees to indemnify and hold Embassy Suites By Hilton harmless from any breach of these representations and warranties. This provides Embassy Suites By Hilton with ongoing protection even after the franchise relationship ends.