When do the obligations under the Hydrodog Guaranty become effective?

According to Hydrodog's 2025 Franchise Disclosure Document, each principal owner must sign and deliver Hydrodog's standard form of Principal Owner's Guaranty during the term of the Franchise Agreement. This guaranty ensures that the principal owner is jointly and severally bound by all provisions of the Franchise Agreement and any other agreements between the franchisee and Hydrodog. A principal owner is defined as someone with at least a 20% ownership interest in the Hydrodog business.

For a prospective Hydrodog franchisee, this means that any individual holding a significant ownership stake (20% or more) will be personally responsible for the Hydrodog franchise's obligations. This responsibility extends to all aspects of the Franchise Agreement, including financial obligations, operational standards, and adherence to Hydrodog's system standards. The Owner's Guaranty is attached as Exhibit B to the Franchise Disclosure Document.

This requirement is a standard practice in franchising, as it ensures that those with a significant financial interest in the business are fully committed to its success and compliance with the franchise agreement. It also provides Hydrodog with an additional layer of security, as they can pursue the personal assets of the principal owners if the franchise fails to meet its obligations. Franchisees should carefully review the Owner's Guaranty and understand the full extent of their personal liability before signing the Franchise Agreement.