How is the purchase price for the Hydrodog Business determined?
Hydrodog Franchise · 2025 FDDAnswer from 2025 FDD Document
- (b) Leasehold Rights. You agree at our election, and at your own expense:
- (i) To assign your leasehold interest in the HydroDog Vehicle to us;
- (ii) To enter into a sublease for the remainder of the lease term on the same terms (including renewal options) as the prime lease; or
- (iii) To lease to us if you own the HydroDog Vehicle in accordance with the Agreement to Lease.
- (c) Purchase Price. The purchase price for the Business will be its fair market value, determined in a manner consistent with reasonable depreciation of the Business's equipment, signs, inventory, materials and supplies; provided that the Business will be valued as an independent business and its value will not include any value for:
- (i) The Franchise or any rights granted by this Agreement;
- (ii) The Marks or Copyrights; or
- (iii) Participation in the network of the HydroDog Businesses.
Your HydroDog Business' fair market value will include the goodwill you developed in the market of your HydroDog Business that exists independent of the goodwill of the Marks and the System. The length of the remaining term of the lease for the HydroDog Vehicle will also be considered in determining your HydroDog Business's fair market value. At our option, we may substitute our repurchase right payment at fair market value of the HydroDog Vehicle, and receive credit for such payment.
We reserve the right to exclude from the assets purchased cash or its equivalent and any equipment, signs, inventory, materials, and supplies that are not reasonably necessary (in function or quality) for the operation of the HydroDog Business, or that do not meet our standards for the HydroDog Businesses. The purchase price will be adjusted accordingly to reflect such exclusions.
(d) Appraisal.
Source: Item 23 — RECEIPTS (FDD pages 43–166)
What This Means (2025 FDD)
According to Hydrodog's 2025 Franchise Disclosure Document, the purchase price for the business is determined by its fair market value. This valuation considers the reasonable depreciation of the business's equipment, signs, inventory, materials, and supplies. However, the valuation specifically excludes any value associated with the franchise itself, the Hydrodog trademarks or copyrights, or participation in the Hydrodog network. The fair market value will include the goodwill you developed in the market of your HydroDog Business that exists independent of the goodwill of the Marks and the System, and the length of the remaining term of the lease for the HydroDog Vehicle.
If Hydrodog terminates the Franchise Agreement or if the franchisee terminates the agreement without cause, Hydrodog has the option to purchase the business. The purchase price will be paid no later than 90 days after the determination of the purchase price. Hydrodog has the right to offset any amounts owed to them by the franchisee against the purchase price.
In the event that Hydrodog and the franchisee cannot agree on the fair market value, an appraisal process is initiated. Each party appoints an appraiser, and the two appraisers then select a third independent appraiser. The franchisee and Hydrodog each bear the cost of their own appraiser, and they equally share the expenses of the third appraiser. The appraisers are required to complete the appraisal within 30 days of the appointment of the third appraiser.