Under what circumstances must a Dog Haus franchisee provide a written statement to the franchisor?

According to Dog Haus's 2025 Franchise Disclosure Document, a franchisee must provide a written statement to the franchisor in two specific instances. First, if there is a conflict between Dog Haus's standards and policies pertaining to Privacy Laws and actual Applicable Law, the franchisee must immediately give Dog Haus written notice of the conflict. Second, if the franchisee intends to pledge, encumber, hypothecate, or grant any third party a security interest in the Franchise Agreement, and the prohibition against such actions is deemed ineffective under Applicable Law, the franchisee must provide not less than ten (10) days' prior written notice to Dog Haus. This notice must include the name and address of the secured party and the terms of the pledge, encumbrance, hypothecation, or security interest.

In the case of a conflict between Dog Haus's privacy standards and applicable law, the franchisee is obligated to comply with the law, notify Dog Haus immediately, and cooperate with Dog Haus and its counsel to find a way to meet Dog Haus's standards within the bounds of the law. This ensures that the franchisee remains compliant with legal requirements while also adhering to Dog Haus's privacy policies to the greatest extent possible. The franchisee cannot independently alter their data privacy policy without Dog Haus's prior written consent.

The requirement to provide written notice before granting a security interest in the Franchise Agreement allows Dog Haus to be informed of any potential encumbrances on the franchise's rights. This is particularly important because the agreement generally prohibits such actions without Dog Haus's consent. If the prohibition is unenforceable under applicable law, the written notice ensures that Dog Haus is aware of the situation and can take appropriate steps to protect its interests. This also allows Dog Haus to assess the potential impact on the franchise and the Dog Haus system as a whole.

These requirements are in place to protect the Dog Haus system, brand, and customer data, and to ensure that franchisees operate in compliance with both Dog Haus's standards and applicable laws. Franchisees should be aware of these obligations and ensure they have processes in place to provide the required written statements in a timely manner.