If Hyatt revokes its approval of the Management Company for The Standardx, what must the Franchisee do?
The_Standardx Franchise · 2025 FDDAnswer from 2025 FDD Document
If Hyatt revokes its approval of the Management Company or of Franchisee as manager, then Franchisee must promptly terminate the Management Arrangement with that Management Company (if applicable) and either assume direct control of the Hotel's management and operation, if Hyatt approves Franchisee to manage the Hotel, or engage another Management Company that Hyatt has approved in writing.
- (d) Core Management Staffing.
Franchisee, the Management Company or the approved F&B Operator (as applicable) is solely responsible for hiring the Core Management and other Hotel personnel and determining the terms and conditions of their employment.
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, if Hyatt revokes its approval of the Management Company or of the franchisee as manager, the franchisee must promptly terminate the Management Arrangement with that Management Company, if applicable. Following the termination, the franchisee has two options. First, the franchisee can assume direct control of the Hotel's management and operation, but only if Hyatt approves the franchisee to manage the Hotel. Second, the franchisee can engage another Management Company that Hyatt has approved in writing.
Hyatt can revoke its approval of the Management Company or franchisee for several reasons. These reasons include if the Management Company or franchisee becomes a Competing Brand Owner, fails to attend and successfully complete mandatory training program(s), fails to meet Hyatt's minimum qualifications (as Hyatt may periodically modify them), or fails to comply with the Franchise Agreement. Non-compliance includes any System Standards and/or if the Hotel remains in any remedial or non-compliant status under Hyatt's then-current Quality Assurance and Compliance Program for three or more consecutive months, the Management Company Documents, or any conditions of operator approval previously imposed by Hyatt.
This requirement ensures that The Standardx hotels maintain Hyatt's standards even if the initial management arrangement falters. The franchisee bears the responsibility of ensuring continuous, Hyatt-approved management, either by taking direct control themselves (with approval) or by hiring a suitable replacement. This protects the brand's reputation and operational consistency.