What happens if the sales price of the interest to be conveyed is too high, in Dog Haus's judgment?
Dog_Haus Franchise · 2025 FDDAnswer from 2025 FDD Document
- The sales price of the interest to be conveyed must not be so high, or the terms of the sale so onerous, that, in the judgment of Franchisor, the Proposed Buyer will be unlikely to meet the Proposed Buyer's financial and other obligations to Franchisor, third party suppliers and creditors following the closing.
Franchisor shall have no liability to either Area Developer or the Proposed Buyer if Franchisor approves the Assignment and the Proposed Buyer thereafter experiences financial difficulties.
Source: Item 23 — RECEIPTS (FDD pages 87–328)
What This Means (2025 FDD)
According to Dog Haus's 2025 Franchise Disclosure Document, the sales price of the interest to be conveyed must not be so high, or the terms of the sale so onerous, that, in the judgment of Dog Haus, the Proposed Buyer will be unlikely to meet the Proposed Buyer's financial and other obligations to Dog Haus, third party suppliers and creditors following the closing.
This means that Dog Haus has the right to refuse the assignment of an Area Developer's interest if they believe the financial terms of the sale would put the buyer at risk of failing to meet their financial obligations. This protects Dog Haus by ensuring that new Area Developers are financially stable and capable of fulfilling their obligations to the brand and its suppliers.
Dog Haus also states that they shall have no liability to either Area Developer or the Proposed Buyer if Dog Haus approves the Assignment and the Proposed Buyer thereafter experiences financial difficulties.