What standards must a proposed transferee meet to be approved by Hydrodog?

your transfer, surrender or loss of possession, control or management of your HydroDog Business.

• 15.3 Conditions for Approval of Transfer. If you (and your owners) are in full compliance with this Agreement, then subject to the other provisions of this Section, we will approve a transfer that meets all the applicable requirements of this Section. The proposed transferee and its direct and indirect owners must be individuals of good character and otherwise meet our then applicable standards for the HydroDog Business franchisees. In addition to examining the qualifications of the proposed transferee and other factors we deem relevant, in deciding whether to approve a transfer, we may also consider the length of time your HydroDog Business has been opened and whether transferring the location at the current time is in the best interest of the System. A transfer of ownership, possession or control of your HydroDog Business may be made only in conjunction with a transfer of this Agreement. If the transfer is of this Agreement or a controlling interest in you, or is one of a series of transfers which in the aggregate constitute the transfer of this Agreement or a controlling interest in you, all of the following conditions must be met prior to or concurrently with the effective date of the transfer:
  • (a) the transferee has sufficient business experience, aptitude and financial resources to operate your HydroDog Business;
  • (b) you have paid all Royalties, Marketing Fund Fees, contributions, amounts owed for purchases from us and all other amounts owed to us or to third-party creditors and have submitted all required reports and statements;
  • (c) the transferee (or its owners) have agreed to complete our standard training program;

• (d) the transferee has agreed to be bound by, and assume, all of the terms and conditions of the Lease or enter into a new one for the remainder of the Lease term as approved by the lessor;
  • (e) the transferee has signed our then-current franchise agreement;
• (f) subject to state law, you have paid to us a transfer fee of twenty thousand dollars ($20,000) per Territory sold;
• (g) if applicable, you have paid to us, or the respective third-party broker, any and all commissions or other fees due;
• (h) you (and your transferring owners) have executed a general release, in form satisfactory to us, of any and all claims against us and our shareholders, officers, directors, employees and agents;
• (i) we have approved the material terms and conditions of such transfer and determined that the price and terms of payment will not adversely affect the transferee's operation of your HydroDog Business;
• (j) if you or your owners finance any part of the sale price of the transferred interest, you and/or your owners have agreed that all of the transferee's obligations pursuant to any promissory notes, agreements or security interests that you or your owners have reserved in your HydroDog Business are subordinate to the transferee's obligation to pay Royalties, Marketing Fund Fees, contributions and other amounts due to us, and you must execute a subordination agreement in a form satisfactory to us evidencing such subordination and otherwise to comply with this Agreement;

Source: Item 23 — RECEIPTS (FDD pages 43–166)