Does Hydrodog have the right to make automated withdrawals from the Operating Account?

According to Hydrodog's 2025 Franchise Disclosure Document, Hydrodog does have the right to make automated withdrawals from the franchisee's Operating Account for agreed-upon fees and payments. Hydrodog may require franchisees to establish an operating account with a bank or financial institution that Hydrodog designates or approves. This account serves as the primary bank account for the Hydrodog Business.

Hydrodog also reserves the right to require franchisees to pay all future royalties via electronic funds transfer. Franchisees must authorize Hydrodog to initiate debit entries or credit correction entries to the franchisee's bank operating account for payments of royalties and other amounts due under the agreement, including any applicable interest charges. Franchisees must report their Hydrodog business's gross sales for the preceding week and ensure funds are available for electronic transfer on the Royalty Payment Day.

Furthermore, if Hydrodog determines that a franchisee has underreported gross sales or underpaid royalties or other amounts, Hydrodog is authorized to immediately initiate a transfer from the account in the appropriate amount, including applicable interest and late charges. Any overpayment by the franchisee will be credited to the account, effective as of the 1st reporting date after Hydrodog determines that such credit is due. This electronic funds transfer authorization is a standard practice in franchising, allowing franchisors to efficiently collect royalties and fees while ensuring accurate financial reporting.