Can Hydrodog offset amounts owed to a franchisee against the franchisee's debts to Hydrodog?
Hydrodog Franchise · 2025 FDDAnswer from 2025 FDD Document
6.14 Application of Payments. Notwithstanding any designation you might make, we have sole discretion to apply any of your payments to any of your past due indebtedness to us.
6.15 Payment Offsets. You acknowledge and agree that we have the right to set-off from any amounts that we may owe you or your owners or any amount that you owe to us, or our affiliates, for any reason whatsoever, including without limitation, Royalties, Marketing Fund Fees, Late Payment Fees and interest on late payments, amounts owed to us or our affiliates for purchases or services or for any other reason.
Thus, payments that we or our affiliates may make to you may be reduced, in our discretion, by amounts that you owe to us or our affiliates from time-to-time.
We will notify you monthly if we elect to do so.
Source: Item 23 — RECEIPTS (FDD pages 43–166)
What This Means (2025 FDD)
According to Hydrodog's 2025 Franchise Disclosure Document, Hydrodog has the right to offset any amounts they may owe to a franchisee against any debts the franchisee owes to Hydrodog or its affiliates. This includes, but is not limited to, royalties, marketing fund fees, late payment fees, interest on late payments, and amounts owed for purchases or services.
This means that if Hydrodog owes a franchisee money for any reason, Hydrodog can reduce that payment by the amount the franchisee owes them. Hydrodog will notify the franchisee monthly if they elect to do so. This provision protects Hydrodog's financial interests by ensuring that outstanding debts from franchisees are addressed, even if Hydrodog also has financial obligations to the franchisee.
For a prospective Hydrodog franchisee, this policy highlights the importance of maintaining timely payments and managing their financial obligations to Hydrodog. Failure to do so could result in Hydrodog offsetting amounts owed to the franchisee, potentially impacting the franchisee's cash flow. Franchisees should carefully review their payment obligations and ensure they are met to avoid any offsets.