Does Hydrodog intend to sell the debt to a third party?
Hydrodog Franchise · 2025 FDDAnswer from 2025 FDD Document
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ITEM 10 FINANCING
| Parameter | Initial Franchise Fee and for additional territories | |
|---|---|---|
| Item Financed (1) | Up to 50% of the Initial Franchise Fee | |
| Source of Financing | Us | |
| Down Payment | $20,000 | |
| Amount Financed | Up to 50% | |
| Interest Rate/Finance Charge | 8% per annum (including finance charges) | |
| Period of Repayment | 60 months | |
| Security Required | Personal Guarantee | |
| Whether a Person Other than the Franchisee Must Personally Guarantee the Debt (2) | If the franchisee is an entity, its owners must personally guarantee the debt | |
| Prepayment Penalty | None | |
| Liability Upon Default | Accelerated obligation to pay the entire amount due, pay our court costs and attorney fees incurred in collecting the debt, and termination of the franchise. | |
| Waiver of Defenses or Other Legal | Waiver of right to a jury trial; homestead and other exemptions; | |
| Rights | waiver of presentment, demand, protest, notice of dishonor. | |
| Intent to Sell (3) | There is no intent to sell, assign or factor the debt to a third party. | |
| Consideration for placement of | None | |
| financing (4) | # Notes: |
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- We may, at our sole discretion, provide financing to you. We do not require that anyone other than you personally guarantee the note.
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- We do not guarantee your notes, leases, or financial obligations.
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Source: Item 10 — FINANCING (FDD page 22)
What This Means (2025 FDD)
According to Hydrodog's 2025 Franchise Disclosure Document, Hydrodog's intent to sell franchisee debt to a third party differs based on the context. The FDD states that Hydrodog does not have any past or present practice to sell, assign, or discount any note, contract, or other instrument signed by the franchisee to any third party. However, Hydrodog reserves the right to do so in the future.
In the section detailing financing terms for the initial franchise fee and additional territories, the FDD explicitly states that there is no intent to sell, assign, or factor the debt to a third party. This provides some reassurance to prospective franchisees that if they receive financing from Hydrodog for the initial franchise fee, Hydrodog does not currently plan to sell that debt to another entity.
It is important for a prospective Hydrodog franchisee to understand that while Hydrodog states it has no current intent to sell the debt related to the initial franchise fee, they reserve the right to sell other debt. A franchisee should seek clarification regarding what types of debt Hydrodog might sell, and under what circumstances. This will help the franchisee understand the potential implications of Hydrodog transferring their debt obligations to a third party.