What happens if a Dq Treat licensee fails an evaluation under section 6.8?
Dq_Treat Franchise · 2025 FDDAnswer from 2025 FDD Document
- 13.1 Default. Licensee is in default of this agreement if Company determines that Licensee or any Owner or guarantor has breached any of the terms of this agreement or any other agreement between Licensee and Company or its affiliates, which includes:
- (F) Failing an evaluation under section 6.8, or failure to abide by Company's standards and requirements in connection with the operation of the Restaurant;
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, failing an evaluation under section 6.8 of the operating agreement constitutes a default of the agreement. Section 6.8 pertains to evaluations conducted by Dq Treat or its representatives, who may enter the restaurant during business hours to assess compliance, inspect the premises and equipment, and evaluate supplies, ingredients, and sanitation.
If a Dq Treat franchisee fails an evaluation, it triggers the default provisions outlined in section 13.1 of the agreement. This means Dq Treat has determined that the franchisee has breached the terms of the agreement.
As a result of this default, Dq Treat has grounds to terminate the agreement as per section 13.2. This could lead to the loss of the franchise, so it is important for a franchisee to maintain standards and abide by Dq Treat's requirements to avoid failing an evaluation.