If a Hydrodog franchisee wants to sell their business, does Hydrodog have a right of first refusal?
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). |
| (n) Franchisor's right of first refusal to acquire franchisee's business | Section 15.8 | We can match any offer for an ownership interest in you, your Franchise Agreement or your HydroDog Business provided that we may substitute cash for any form of payment at a discounted amount if an interest rate will be charged on any deferred payments, our credit will be deemed equal to that of any proposed purchaser, we will have no less than 60 days to prepare for closing and we receive all customary representations and warranties, as we specify. |
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, Hydrodog does have a right of first refusal if a franchisee wishes to sell their business. Specifically, Hydrodog can match any offer made for an ownership interest in the franchisee, the Franchise Agreement itself, or the Hydrodog Business.
This right is subject to certain conditions. Hydrodog can substitute cash for any form of payment offered by the prospective buyer, potentially at a discounted amount if the buyer's offer includes interest on deferred payments. Hydrodog's credit will be considered equal to that of any proposed purchaser. Hydrodog also has a minimum of 60 days to prepare for the closing of the sale. Finally, Hydrodog must receive all customary representations and warranties as they specify.
Additionally, in the event of the death or disability of a Hydrodog franchisee, any assignment of the franchise or ownership interest is subject to Hydrodog's right of first refusal. This means that even in these circumstances, Hydrodog has the first option to purchase the business before it is offered to another buyer.