What is the name of the agreement discussed in this section for The Standardx franchisees?
The_Standardx Franchise · 2025 FDDAnswer from 2025 FDD Document
r (together with the other loan documents evidencing or securing such indebtedness, as amended, restated or otherwise modified from time to time, the "Loan Documents") and (2) that the loan proceeds will be used for the direct benefit of the Hotel. Franchisee and Lender have requested that Hyatt enter into this letter agreement (this "Comfort Letter"). Franchisee or Lender shall pay to Hyatt a fee in the amount of Two Thousand Five Hundred Dollars ($2,500) in connection with this Comfort Letter, prior to or simultaneous with its execution. Capitalized terms used but not defined herein shall have the meanings ascribed to them in the Franchise Agreement.
Hyatt, Franchisee, and Lender agree as follows:
- While Lender has a valid first mortgage on the Hotel during the term of the Franchise Agreement, Hyatt agrees to use commercially reasonable efforts to (a) give Lender thirty (30) days prior written notice of any voluntary surrender by Franchisee of the Franchise (to the extent that Hyatt is aware in advance of any such voluntary surrender) and (b) furnish Lender with copies of default notices sent by Hyatt to Franchisee. In the event of a default by Franchisee under the Franchise Agreement Hyatt shall allow Lender thi
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 agreement under which a franchisee operates a hotel is called the "Franchise Agreement." This agreement outlines the terms, conditions, and restrictions regarding the management and operation of the hotel. Several sections of the Franchise Agreement are specifically referenced, including Articles IV, V, and XII, as well as Sections 11.5, 11.6, 11.7, and 16.5. These sections cover various aspects, such as operational requirements, confidentiality, and potential liquidated damages.
Several other agreements may be related to the Franchise Agreement. For example, a Comfort Letter may be entered into between Hyatt, the franchisee, and a lender, especially when the hotel secures indebtedness. Additionally, a Management Agreement may exist if a management company operates the hotel, in which case the management company acknowledges and agrees to be bound by the terms of the Franchise Agreement.
The Franchise Agreement also addresses governing law and consent to jurisdiction, specifying that the laws of the State of Illinois govern the agreement, except where federal law or the Rhode Island Franchise Investment Act applies. The document also clarifies that if any part of the agreement is deemed invalid, the remaining portions will still be in effect. Furthermore, The Standardx or the franchisee can waive obligations under the agreement through a signed written instrument.
Prospective franchisees should carefully review the Franchise Agreement and any related documents to fully understand their rights, obligations, and the potential financial implications of operating a The Standardx hotel. Understanding these agreements is crucial for a successful franchise relationship.