Does a Dq Treat franchisee have the right to sublicense or control the location of future restaurants?
Dq_Treat Franchise · 2025 FDDAnswer from 2025 FDD Document
(D) Any right to sublicense, or exclude, control or impose conditions on the location or development of future restaurants or stores.
2.4 Reservation of Rights. Company reserves all rights not expressly granted to Licensee under this agreement.
Company and its affiliates have the right to operate and grant others the right to operate competing businesses at any location but the Authorized Location, as determined by Company or its affiliates.
These locations may include freestanding buildings and facilities, strip centers, shopping malls, and other similar locations.
These locations also may include transportation terminals, sports facilities, recreation areas, hotels, hospitals, campus facilities, and other non-traditional locations.
Source: Item 17 — The following paragraph is added to the end of Item 17 of the Disclosure Document: (FDD pages 70–378)
What This Means (2025 FDD)
According to the 2025 Dq Treat FDD, franchisees are explicitly prohibited from sublicensing or controlling the location of future restaurants. The franchise agreement grants the franchisee a limited license to operate a single Dq Treat restaurant at a specific, authorized location. This license does not extend to any rights regarding the development or location of additional restaurants.
This restriction means that a Dq Treat franchisee cannot authorize another party to operate a Dq Treat store under their franchise agreement. They also cannot influence or dictate where new Dq Treat locations might be established. This control remains solely with American Dairy Queen Corporation and its affiliates.
American Dairy Queen Corporation retains all rights not expressly granted to the franchisee, including the right to operate or grant others the right to operate competing businesses at any location other than the franchisee's authorized location. This includes various types of locations such as freestanding buildings, shopping malls, transportation terminals, and even non-traditional venues like hotels and hospitals. This ensures that Dq Treat maintains complete strategic control over its brand's expansion and market presence.