Successful Meetings - September 2007 - (Page 18)

Meetings Law > By D. Benson Tesdahl, Esq. Flying a New Flag Copyrighting Conference Content In today’s business world, mergers and acquisitions are common. Hotel properties are being bought and sold, sometimes with little or no prior notice to the public. Between the time that the meeting contract is signed and the time that the meeting actually occurs, it is possible for a number of things to happen to the host hotel. Many hotel properties are managed by one company and owned by another, and some hotel property owners change their management companies and rebrand their properties nearly as often as they change their sheets. So it’s wise to understand the implications of this before you sign a meeting contract. PROTECTING YOURSELF The simplest way to protect your organization in the event your host hotel gets sold, or its management changes prior to the meeting, is to insist that a clause covering these potentialities be added to the contract. Hotels will never willingly offer such a clause up front, so you will need to raise the issue and draft the clause yourself to ensure it is crafted in your favor. A clause that I often use is the following: In the event that Hotel undergoes a 51-percent or greater change in management, a change in management company, a change in chain affiliation, Hotel becomes insolvent, a foreclosure occurs, or Hotel has filed for bankruptcy, Hotel is obligated to inform Group in writing within thirty (30) days of having notice of any of the foregoing events. Group may then, within sixty (60) days of receiving notice from Hotel, terminate this contract without liability. In the event of termination of this agreement by Group, Hotel shall reimburse Group for all expenses and damages incurred as a result of moving its meeting to a different property. WHY IT MATTERS While the new owner or the new management company of a hotel property will be quick to assure you that you have nothing to worry about and that your meeting will not be affected by the sale or rebranding, you should take such assurances with a grain of salt. There can be—and often are— adverse ramifications to future meetings and conferences whenever a hotel is sold or rebranded. First, attendees who had planned to use their accumulated frequent guest points to pay for their rooms at an upcoming conference may be unable to if the property is now affiliated with a different company. This will leave you with many unhappy attendees, and may even affect room attrition and conference profit. Similarly, many hotels will give an organization’s meeting planner many thousands of frequent stay points in return for booking a large meeting at the hotel, and that offer also may evaporate if the property changes flags. In addition, a new management company will likely bring in its own staff, which may not be as well trained and cohesive as the staff of the prior management company. A new owner or manager also will often institute new hotel policies that may include fewer perks, a lesser degree of service, or more fees and surcharges for hotel guests than the prior owner had. All of these things can affect the success of a meeting. Sometimes, a new buyer or property manager will radically change the decor or theme of a hotel, which can change the entire character of your meeting. Or sometimes, the new owner will try to upgrade the property by instituting extensive construction and renovations, which may occur during the time of your conference and cause considerable noise and disruption. Notice that the foregoing clause puts a relatively short time limit on the hotel manager to inform the group having the meeting of the sale or change of management, but it puts a much longer time limit on the organization’s right to back out of the contract. This gives you the opportunity to take your time and carefully investigate the situation. Notice also that the clause allows expenses and damages to be collected from the hotel, provided that those expenses and damages can be proven. If a hotel is sold or rebranded close to the time of a planned meeting, the expenses incurred in moving the meeting to another property can be considerable, and may include printing change of location notices for all attendees, updating website and registration brochures, refunding money to vendors and exhibitors who may not be able to move to the new meeting location, and so on. Such measures may not always be necessary. But it is always the case that a well-drafted contract clause can put you in the driver’s seat in the event of a hotel sale or change of management, and the driver’s seat is always the best place to be when a meeting contract issue arises. Ben Tesdahl, Esq. is an attorney concentrating in nonprofit, corporate, and contract law, including meeting and convention law. He is with the law firm of Powers, Pyles, Sutter & Verville, P.C. in Washington D.C. He can be reached at (202) 466-6550 or at ben.tesdahl@ppsv.com mimegasite.com SEPTEMBER 2007 SUCCESSFUL MEETINGS ILLUSTRATION: NED SHAW 18 http://mimegasite.com

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Successful Meetings - September 2007 Contents Editor's Note Research Calendar Suppliers Planner Spotlight Websites of the Month Management Matters Meetings Law Personal Success Pre-Event Tools of the Trade The Social Revolution Long Beach Insert State of the Art A Better Banquet The Seven Wonders of the Gaming World On the List Places & Spaces Caribbean Trinidad & Tobago Insert Monaco Greater Los Angeles Hilton Head/Myrtle Beach Gurus Nevada Planners Guide 2007 This Just In Las Vegas The Big Picture The Benefits of Being Small Let's Get Together Let Us Entertain You This Just in Reno Tahoe Perfect Complements Hotel Stats & Contact Info Hawaii Incentive Handbook 2007

Successful Meetings - September 2007

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