Under the Hydrodog agreement, what is the effect of accepting payments which are otherwise due?
Hydrodog Franchise · 2025 FDDAnswer from 2025 FDD Document
on Late Payments.** All amounts which you owe us or our affiliates will bear interest after their due date at the annual rate of the lesser of two percent (2%) per month or the highest contract rate of interest permitted by law. You acknowledge that we do not agree to accept any payments after they are due nor commit to extend credit to, or otherwise finance your operation of, your HydroDog Business. Your failure to pay all amounts when due constitutes grounds for termination of this Agreement.
- 6.12 Late Payment Fees. All Royalties, Marketing Fund Fees, amounts due for purchases by you from us or our affiliates, and any interest accrued thereon, and any other amounts which you owe us or our affiliates, are subject to a late payment fee of ten percent (10%) of the amount due, or the highest rate permitted by law (the "Late Payment Fee"). The Late Payment Fee is due immediately upon any delinquent payments and is in addition to any other fees due and payable to us. The provision in this Agreement concerning Late Payment Fees does not mean that we accept or condone late payments, nor does it indicate that we are willing to extend credit to, or otherwise finance the operation of, your HydroDog Business.
- 6.13 Insufficient Funds Fee. If any payment from you does not successfully convey funds due to insufficient funds, stop payment instructions, or any similar event, you shall pay, upon demand, an insufficient funds fee equal to fifty dollars ($50.00).
- 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 servi
Source: Item 23 — RECEIPTS (FDD pages 43–166)
What This Means (2025 FDD)
According to Hydrodog's 2025 Franchise Disclosure Document, Hydrodog does not agree to accept late payments, nor does it commit to extending credit or financing a franchisee's operations. If a Hydrodog franchisee fails to pay amounts when due, it constitutes grounds for termination of the franchise agreement.
Late payments to Hydrodog are subject to a late payment fee of 10% of the amount due, or the highest rate permitted by law. This fee applies to royalties, marketing fund fees, amounts due for purchases from Hydrodog or its affiliates, and any interest accrued. The late payment fee is due immediately upon any delinquent payments and is in addition to any other fees due and payable to Hydrodog. Hydrodog also charges a $50 fee for insufficient funds if a payment does not successfully convey funds due to insufficient funds, stop payment instructions, or any similar event.
Hydrodog retains the sole discretion to apply any payments received from a franchisee to any past due indebtedness, regardless of any designation the franchisee might make. Additionally, Hydrodog has the right to offset any amounts it may owe to the franchisee (or their owners) against any amounts the franchisee owes to Hydrodog or its affiliates, including royalties, marketing fund fees, late payment fees, and interest on late payments. Hydrodog will notify the franchisee monthly if it elects to do so.