What agreement does the Management Company make in the Management Company Documents for The Standardx?
The_Standardx Franchise · 2025 FDDAnswer from 2025 FDD Document
In consideration of the rights granted to Management Company under the Management Agreement and of Hyatt's consent (under the Franchise Agreement) to Management Company's operation of the Hotel, Management Company hereby acknowledges and ratifies the terms and conditions of the Franchise Agreement and agrees to fully observe and be bound by all terms, conditions and restrictions regarding the management and operation of the Hotel set forth in the Franchise Agreement for as long as Management Company operates the Hotel, as if and as though Management Company had executed the Franchise Agreement as "Franchisee," including, without limitation, all terms and conditions of ARTICLE IV and ARTICLE V of the Franchise Agreement (other than Section 4.2(a)). Management Company further agrees to be bound by the confidentiality and other covenants set forth in Sections 11.5, 11.6, and 11.7 of the Franchise Agreement (including all remedies available to Hyatt under the Franchise Agreement for breach thereof) during and subsequent to its tenure as manager of the Hotel. However, notwithstanding the foregoing, nothing in this Rider constitutes an agreement of Management Company: (a) to pay or assume any financial obligation of Franchisee to Hyatt or to any third party, including any obligation of Franchisee to pay Royalty Fees or System Services Charges or any liquidated damages pursuant to Section 16.5 of the Franchise Agreement; or (b) to be bound by any provision in ARTICLE XII of the Franchise Agreement. Management Company represents and warrants to Hyatt and Franchisee that Management Company is not a Competing Brand Owner, as defined in the Franchise Agreement.
Management Company agrees that Hyatt may enforce directly against Management Company those terms and conditions of the Franchise Agreement to which Management Company has hereby agreed to be bound. Franchisee acknowledges and agrees that any act or omission of Management Company relating directly or indirectly to the Hotel will be deemed and considered the act or omission of Franchisee for purposes of Hyatt's rights and remedies under the Franchise Agreement (including, without limitation, Franchisee's indemnification and defense obligations
Source: Item 18 — OTHER INCOME (LOSS), NET (FDD pages 187–399)
What This Means (2025 FDD)
According to The Standardx's 2025 Franchise Disclosure Document, the Management Company agrees to several key conditions as part of the Management Company Documents. The Management Company must acknowledge and adhere to the terms and conditions outlined in the Franchise Agreement, as if they were the franchisee. This includes all terms, conditions, and restrictions related to the management and operation of the hotel. Specifically, the Management Company must comply with Article IV and Article V of the Franchise Agreement, with the exception of Section 4.2(a). They must also abide by the confidentiality and other covenants detailed in Sections 11.5, 11.6, and 11.7 of the Franchise Agreement, both during and after their tenure as the hotel's manager.
However, the Management Company's obligations do not extend to the financial responsibilities of the franchisee. They are not required to pay or assume any financial obligations of the franchisee to Hyatt or any third party. This includes the franchisee's obligation to pay Royalty Fees, System Services Charges, or any liquidated damages as per Section 16.5 of the Franchise Agreement. Additionally, the Management Company is not bound by any provision in Article XII of the Franchise Agreement. The Management Company also represents and warrants that it is not a Competing Brand Owner, as defined in the Franchise Agreement.
Furthermore, The Standardx has the right to directly enforce the terms and conditions of the Franchise Agreement against the Management Company, to which the Management Company has agreed to be bound. The franchisee acknowledges that any action or failure to act by the Management Company related to the hotel will be considered the action or failure to act of the franchisee. This includes the franchisee's obligations for indemnification and defense under the Franchise Agreement. These stipulations ensure that The Standardx maintains brand standards and operational consistency even when a third-party management company is involved.