Under what conditions can Standard International terminate the Standard International Trademark License Agreement related to The Standardx?
The_Standardx Franchise · 2025 FDDAnswer from 2025 FDD Document
Standard International granted Hyatt Corporation the rights to use and sublicense the StandardX Proprietary Marks under a Trademark License Agreement dated October 1, 2024 (the "Standard International Trademark License Agreement"), which are subsequently sublicensed to us via the Trademark License Agreement discussed above. That agreement has a perpetual term, subject to termination by Standard International for cause. Standard International may terminate the agreement if Standard International and Hyatt Corporation are no longer under common control, if Hyatt Corporation fails to make a required payment and does not cure the failure within 7 days after notice, if Hyatt Corporation fails to maintain or require its sublicensees (including us) to maintain Standard International's prescribed standards of quality and service and does not cure the failure within 30 days after notice, if Hyatt Corporation fails to comply with any other provision of the agreement and does not cure the failure within 30 days after notice, or if Hyatt Corporation has an insolvency event and does not cure the failure within 60 days after notice. If Standard International terminates the Standard International Trademark License Agreement because Hyatt or we failed to maintain or failed to require its or our sublicensees to maintain Standard International's standards of quality and service, Standard International may enter into a license with our authorized franchisees, but only if the franchisee not in default of its franchise agreement.
Source: Item 13 — Trademarks (FDD pages 66–68)
What This Means (2025 FDD)
According to The Standardx's 2025 Franchise Disclosure Document, the Standard International Trademark License Agreement, dated October 1, 2024, has a perpetual term but can be terminated by Standard International for cause. This agreement grants Hyatt Corporation the rights to use and sublicense the StandardX Proprietary Marks, which are then sublicensed to The Standardx.
Standard International can terminate the agreement under several specific conditions related to Hyatt Corporation's actions. These include if Standard International and Hyatt Corporation are no longer under common control. Termination can also occur if Hyatt Corporation fails to make a required payment and does not correct this failure within 7 days after receiving notice. Furthermore, if Hyatt Corporation fails to maintain, or require its sublicensees (including The Standardx) to maintain, Standard International's prescribed standards of quality and service, and does not remedy this within 30 days after notice, Standard International can terminate the agreement.
Additional grounds for termination exist if Hyatt Corporation fails to comply with any other provision of the agreement and does not cure the failure within 30 days after notice, or if Hyatt Corporation experiences an insolvency event and does not resolve it within 60 days after notice. It is important to note that if the termination is due to a failure to maintain quality and service standards, Standard International has the option to enter into a license with The Standardx's authorized franchisees, provided that the franchisee is not in default of their franchise agreement. This provides a potential avenue for franchisees to continue operating under the trademarks even if the overarching agreement is terminated due to Hyatt's or The Standardx's failure to uphold standards.