Does Hydrodog require the franchisee's consent to merge with another company?
Hydrodog Franchise · 2025 FDDAnswer from 2025 FDD Document
- 15.1 By Us. We have the exclusive right to transfer or assign this Agreement or any part of our rights or obligations under this Agreement to any person or legal entity, without your prior consent. You agree that we will have no liability after the effective date of the transfer or assignment for the performance of any obligations under this Agreement, unless otherwise stipulated in the terms of the transfer or assignment. You acknowledge that we can sell our assets; sell securities in a public offering or in a private placement; merge with, acquire, or be acquired by another company; or undertake a refinancing, recapitalization, leveraged buy-out, or other economic or financial restructuring, without restriction and without affecting your obligations under this Agreement.
- 15.2 By You. You understand and acknowledge that the rights and duties created by this Agreement are personal to you (or, if you are a Business Entity, to your owners) and that we have granted the Franchise to you in reliance upon our perceptions of your (or your owners') individual or collective character, skill, aptitude, attitude, business ability and financial capacity. Accordingly, neither this Agreement (or any interest in it) nor any ownership or other interest that would reduce your voting or equity interest to less than 51% in you or your HydroDog Business may be transferred without our prior written approval. Any transfer without such approval constitutes a breach of this Agreement and is void and of no effect. As used in this Agreement, the term "transfer" includes your (or your owners') voluntary,
involuntary, direct or indirect assignment, sale, gift or other disposition of any interest in: (a) this Agreement; (b) you; or (c) your HydroDog Business.
Source: Item 23 — RECEIPTS (FDD pages 43–166)
What This Means (2025 FDD)
According to Hydrodog's 2025 Franchise Disclosure Document, Hydrodog does not require the franchisee's consent to merge with, acquire, or be acquired by another company. Hydrodog retains the right to engage in such transactions without affecting the franchisee's obligations under the agreement.
This means that Hydrodog can undergo mergers, acquisitions, or other financial restructurings without needing the franchisee's approval. However, if Hydrodog merges with or is acquired by another entity, and this results in a conversion of the Hydrodog Business, the merging or acquiring entity is responsible for reimbursing the franchisee for reasonable costs directly related to that conversion.
This clause protects Hydrodog's ability to adapt and evolve its business model without being hindered by individual franchisee consent. While franchisees are obligated to participate in any required conversions, they are entitled to reimbursement for reasonable costs incurred during the process. This is a fairly standard practice in franchising, allowing the franchisor flexibility while providing some financial protection to franchisees during significant changes.
Prospective franchisees should be aware that Hydrodog can make significant changes to the franchise system through mergers or acquisitions, and while they will be reimbursed for direct conversion costs, there is no guarantee that the new system will be as profitable or favorable as the original.