What must The Standardx do before changing its bank account used in the operation of the Hotel?
The_Standardx Franchise · 2025 FDDAnswer from 2025 FDD Document
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- Electronic Payments. You must make all payments for Royalty Fees, System Services Charges and other amounts due to us or any member of the Hyatt Group under the Franchise Agreement or relating to the Hotel by electronic funds transfer ("EFT") in compliance with System Standards. We periodically may change the procedure for payments. You must make funds available in your account to cover payments when due. You may not change your bank, financial institution, or account used in the operation of the Hotel without first telling us.
Source: Item 6 — Other Fees (FDD pages 20–36)
What This Means (2025 FDD)
According to The Standardx's 2025 Franchise Disclosure Document, a franchisee must inform The Standardx before changing the bank, financial institution, or account used in the operation of the Hotel. This requirement is part of the electronic payment terms outlined in the franchise agreement.
This stipulation ensures that The Standardx can maintain consistent and reliable electronic fund transfers (EFT) for royalty fees, system services charges, and other payments. Since The Standardx periodically may change the procedure for payments, knowing which account the franchisee uses is important. It allows The Standardx to keep track of payment sources and avoid disruptions in financial transactions.
For a prospective franchisee, this means that any change to their banking arrangements for the Hotel's operations must be communicated to and approved by The Standardx. Failing to do so could potentially lead to a breach of the franchise agreement and possible penalties or complications in remitting payments. This is a fairly standard requirement in franchising, as franchisors need to maintain control over financial processes to ensure consistent revenue collection and financial reporting.