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have found. Accordingly, we looked for other alternatives. The
Budapest agreement resembled the type of package that the Hyatt
International group provided to those hotels where local
management was not provided. It included preopening and
technical services, management expertise, chain services, and the
trade names and marks. The Odakyu agreement provided for the use
of the names and marks, chain services, manuals, among other
things, and provided us with some guidance. The hotels involved
in that agreement used their Century names in conjunction with
the Hyatt names and also had the benefit of Hyatt chain services.
Unfortunately, there is insufficient information to enable the
fee structure for the Budapest or Odakyu agreement to be
translated, extrapolated, and applied to the other transactional
relationships in the Hyatt International group.
As we have already explained, the franchise relationship is
analogous to the relationship between HIC and its hotel
management subsidiaries. HIC did not operate the hotel; it
provided services to the management companies. Accordingly, we
see the franchise rates as the most indicative of arm’s-length
consideration for the services that HIC provided. We also
recognize, however, that the master hotel management subsidiaries
such as HHK and HS worked in conjunction with HIC to provide
those franchise type intangibles and services to the hotel
operators under their supervision, assisting in the writing of
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