Under what conditions can Hydrodog exercise its right of first refusal to acquire a Hydrodog franchisee's business?

Question

Accepted Answer

| Provisions                                                                        | Other Agreement                                          | Summary                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
|-----------------------------------------------------------------------------------|----------------------------------------------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|  |  | of the Agreement Date; abandonment; unapproved transfers; conviction of or a plea of no contest to, a felony or other serious crime; dishonest or unethical conduct; unauthorized assignment of the Franchise Agreement or of an ownership interest in you or the HydroDog Business; loss of the HydroDog Vehicle; unauthorized use or disclosure of the Manuals or confidential information; failure to pay taxes, repeated defaults (even if cured); and bankruptcy. All non-curable defaults are subject to applicable state law. |
| (i) Franchisee's obligations on termination/ non renewal | Sections 17.1 - 17.4 | Obligations include payment of outstanding amounts, complete de-identification and return of confidential information (also see (r) below). |
| (j) Assignment of contract by franchisor | Sections 15.1, 15.4, 15.5 and 15.6 | No restriction on our right to assign. |
| (k) | Section 15.2 | Voluntary or involuntary, direct or indirect |
| "Transfer" by |  | assignment, sale, gift or other disposition of any |
| franchisee - |  | interest in the Franchise Agreement, you or the |
| defined |  | HydroDog Business. |
| (l) Franchisor's approval of transfer by franchisee | Section 15.2 | We have the right to approve all transfers, even to a Business Entity controlled by you. |
| (m) Conditions for franchisor approval of transfer | Section 15.3 | New franchisee qualifies, you pay us all amounts due, transferee and its managerial employees agree to complete training, transferee agrees to be bound by terms and conditions of Franchise Agreement, our then current form of Franchise Agreement is signed and the then-current initial franchise fee is paid, we approve material terms, you subordinate amounts due to you, and you sign other documents we require - including general releases in the form provided in Exhibit "E" (also see r below). |
| (n) Franchisor's right of first refusal to acquire franchisee's business | Section 15.8 | We can match any offer for an ownership interest in you, your Franchise Agreement or your HydroDog Business provided that we may substitute cash for any form of payment at a discounted amount if an interest rate will be charged on any deferred payments, our credit will be deemed equal to that of any proposed purchaser, we will have no less than 60 days to prepare for closing and we receive all customary representations and warranties, as we specify.

Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 36–38)

Under what conditions can Hydrodog exercise its right of first refusal to acquire a Hydrodog franchisee's business?

Answer from 2025 FDD Document

What This Means (2025 FDD)

Provisions	Other Agreement	Summary
		of the Agreement Date; abandonment; unapproved transfers; conviction of or a plea of no contest to, a felony or other serious crime; dishonest or unethical conduct; unauthorized assignment of the Franchise Agreement or of an ownership interest in you or the HydroDog Business; loss of the HydroDog Vehicle; unauthorized use or disclosure of the Manuals or confidential information; failure to pay taxes, repeated defaults (even if cured); and bankruptcy. All non-curable defaults are subject to applicable state law.
(i) Franchisee's obligations on termination/ non renewal	Sections 17.1 - 17.4	Obligations include payment of outstanding amounts, complete de-identification and return of confidential information (also see (r) below).
(j) Assignment of contract by franchisor	Sections 15.1, 15.4, 15.5 and 15.6	No restriction on our right to assign.
(k)	Section 15.2	Voluntary or involuntary, direct or indirect
"Transfer" by		assignment, sale, gift or other disposition of any
franchisee -		interest in the Franchise Agreement, you or the
defined		HydroDog Business.
(l) Franchisor's approval of transfer by franchisee	Section 15.2	We have the right to approve all transfers, even to a Business Entity controlled by you.
(m) Conditions for franchisor approval of transfer	Section 15.3	New franchisee qualifies, you pay us all amounts due, transferee and its managerial employees agree to complete training, transferee agrees to be bound by terms and conditions of Franchise Agreement, our then current form of Franchise Agreement is signed and the then-current initial franchise fee is paid, we approve material terms, you subordinate amounts due to you, and you sign other documents we require - including general releases in the form provided in Exhibit "E" (also see r below).
(n) Franchisor's right of first refusal to acquire franchisee's business	Section 15.8	We can match any offer for an ownership interest in you, your Franchise Agreement or your HydroDog Business provided that we may substitute cash for any form of payment at a discounted amount if an interest rate will be charged on any deferred payments, our credit will be deemed equal to that of any proposed purchaser, we will have no less than 60 days to prepare for closing and we receive all customary representations and warranties, as we specify.