How does Hydrodog define 'transfer' of the franchise?
Hydrodog Franchise · 2025 FDDAnswer from 2025 FDD Document
| Provisions | Other Agreement | Summary |
|---|---|---|
| of the Agreement Date; abandonment; unapproved transfers; conviction of or a plea of no contest to, a felony or other serious crime; dishonest or unethical conduct; unauthorized assignment of the Franchise Agreement or of an ownership interest in you or the HydroDog Business; loss of the HydroDog Vehicle; unauthorized use or disclosure of the Manuals or confidential information; failure to pay taxes, repeated defaults (even if cured); and bankruptcy. All non-curable defaults are subject to applicable state law. | ||
| (i) Franchisee's obligations on termination/ non renewal | Sections 17.1 - 17.4 | Obligations include payment of outstanding amounts, complete de-identification and return of confidential information (also see (r) below). |
| (j) Assignment of contract by franchisor | Sections 15.1, 15.4, 15.5 and 15.6 | No restriction on our right to assign. |
| (k) | Section 15.2 | Voluntary or involuntary, direct or indirect |
| "Transfer" by | assignment, sale, gift or other disposition of any | |
| franchisee - | interest in the Franchise Agreement, you or the | |
| defined | HydroDog Business. | |
| (l) Franchisor's approval of transfer by franchisee | Section 15.2 | We have the right to approve all transfers, even to a Business Entity controlled by you. |
| (m) Conditions for franchisor approval of transfer | Section 15.3 | New franchisee qualifies, you pay us all amounts due, transferee and its managerial employees agree to complete training, transferee agrees to be bound by terms and conditions of Franchise Agreement, our then current form of Franchise Agreement is signed and the then-current initial franchise fee is paid, we approve material terms, you subordinate amounts due to you, and you sign other documents we require - including general releases in the form provided in Exhibit "E" (also see r below). |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 36–38)
What This Means (2025 FDD)
According to Hydrodog's 2025 Franchise Disclosure Document, a 'transfer' by the franchisee is defined as the assignment, sale, gift, or other disposition of any interest in the Franchise Agreement, the franchisee, or the HydroDog Business. This definition is broad and encompasses various ways a franchisee might relinquish or share their stake in the franchise.
This means that any action that results in a change of ownership or control of the Hydrodog franchise, whether voluntary or involuntary, falls under the umbrella of 'transfer'. This includes not only outright sales but also actions like gifting a portion of the business to a family member or assigning the Franchise Agreement to another party.
Hydrodog maintains the right to approve all transfers, even those to a business entity controlled by the franchisee. This approval process allows Hydrodog to ensure that any new owner meets their standards and is capable of operating the franchise successfully. The franchisor's approval is crucial, and the franchisee must adhere to specific conditions to get the transfer approved.
These conditions include ensuring the new franchisee is qualified, paying all outstanding amounts owed to Hydrodog, ensuring the transferee and their managerial employees complete training, securing the transferee's agreement to be bound by the terms of the Franchise Agreement, signing Hydrodog's current form of Franchise Agreement, paying the then-current initial franchise fee, obtaining approval of material terms, subordinating any amounts due to the franchisee, and signing any other required documents, including general releases.