To whom are the fees payable for a Dq Treat franchise?
Dq_Treat Franchise · 2025 FDDAnswer from 2025 FDD Document
- (1) Except where otherwise noted, all fees are payable to ADQ or one of ADQ's affiliates, are uniformly imposed and are nonrefundable.
Type of Fee Amount(1) P Due Date(5) P Remarks Lease-Required Sales Promotion Fees Will vary under circumstances When due In addition to the sales promotion program fees above, you must pay all sales promotion fees and comply with all sales promotion requirements required by your lease or sublease. Transfer Fee (for franchise agreement) $6,000 When you submit transfer application Effective January 1, 2030, and each 5 years thereafter, the transfer fee increases by $500. If ADQ refuses to consent to your proposed transfer or exercises its right of first refusal, ADQ will return the transfer fee, less any actual expenditures or disbursements that ADQ makes in direct connection with processing the proposed transfer. Renewal Fee (for franchise agreement) $1,000 times number of years under renewal term (but not to exceed $10,000) At time of renewal Any partial year of the renewal term will count as a full year for purposes of calculating the renewal fee. For example, if at the end of the initial term of the franchise agreement, you enter into a renewal franchise agreement with a term of 7½ years, you will be required to pay a renewal fee of $8,000. Audit and Recordkeeping Costs Your contractual percentage continuing license fees and percentage sales promotion program fees times the amount of understated Gross Sales, plus any other amounts owed to us After audit revealing understatement of Gross Sales by 3% or more If an initial evaluation or audit reveals an understatement of Gross Sales by 3% or more, you must pay all costs for the audit, including salaries, outside accountant and attorneys’ fees, copying costs, postage, travel, meals, and lodging (“audit costs”), plus audit costs for any additional audits within 2 years after the initial evaluation or audit.
Source: Item 6 — Other Fees (FDD pages 20–24)
What This Means (2025 FDD)
According to Dq Treat's 2025 Franchise Disclosure Document, most fees are payable to ADQ or one of its affiliates. There are some exceptions to this rule, but generally, franchisees should expect to remit payments to ADQ or an affiliated entity. These fees are uniformly imposed and are nonrefundable.
For example, the franchise agreement transfer fee of $6,000 is paid when the transfer application is submitted to ADQ. This fee increases by $500 every five years, starting January 1, 2030. Similarly, the renewal fee, calculated as $1,000 times the number of years in the renewal term (up to $10,000), is paid at the time of renewal to ADQ.
However, lease-required sales promotion fees are an exception. These fees vary depending on the specific lease or sublease agreement and are paid as required by those agreements, not necessarily to ADQ. Additionally, if an audit reveals understated gross sales by 3% or more, the franchisee must cover all audit costs, including accountant and attorney fees, which would be paid to those service providers, not directly to Dq Treat.