What is the length of the term for a Successor Franchise Agreement with The Standardx?
The_Standardx Franchise · 2025 FDDAnswer from 2025 FDD Document
When this Agreement expires, if Franchisee (and, as applicable, each Guarantor): (a) has substantially complied with this Agreement during its Term and is in full compliance with this Agreement (including all System Standards) as of the date upon which this Agreement expires; (b) then meets Hyatt's then applicable standards for franchisees and owners of franchisees of Brand Hotels; (c) has received passing Quality Assurance Scores (as defined in the System Standards) on all evaluations conducted during the preceding three (3)-year period; and (d) has the right to maintain possession of the Hotel for at least ten (10) years following this Agreement's expiration, then Hyatt will offer Franchisee the right to enter into a successor franchise agreement to continue operating the Hotel as a Brand Hotel for a term commencing immediately upon the expiration of this Agreement and expiring ten (10) years from that date (the "Successor Franchise Right") in accordance with this ARTICLE XIII.
If Franchisee (or any Guarantor) does not meet the requirements of this Section 13.1, then Hyatt need not enter into a successor franchise agreement with Franchisee, whether or not Hyatt notified Franchisee of the non-compliance or had, or chose to exercise, the right to terminate this Agreement during its Term.
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 a franchisee meets certain requirements, The Standardx will offer the franchisee the right to enter into a successor franchise agreement. This agreement allows the franchisee to continue operating the hotel as a Brand Hotel. The term for this Successor Franchise Agreement commences immediately upon the expiration of the original agreement and extends for ten years from that date.
To be eligible for a Successor Franchise Agreement, the franchisee must have substantially complied with the original agreement throughout its term and be in full compliance at the time of expiration. This includes adhering to all System Standards. Additionally, the franchisee must meet The Standardx's then-current standards for franchisees and owners, and have received passing Quality Assurance Scores on all evaluations conducted during the three years preceding the agreement's expiration. The franchisee must also have the right to maintain possession of the hotel for at least ten years following the original agreement's expiration.
It is important to note that The Standardx may use a franchise agreement for the successor franchise that differs materially from the original agreement. However, The Standardx will not charge a successor franchise fee. Franchisees and guarantors must also sign general releases of any claims against The Standardx and its affiliates.