What happens to the Dq Treat Participation Agreement if the franchisee agreement with Client is terminated or expires?
Dq_Treat Franchise · 2025 FDDAnswer from 2025 FDD Document
- Termination of Franchise Agreement(s).
Termination or expiration of Operated Location's, Participating Franchisee's or Sub-Franchisee's franchisee agreement(s) with Client ("Franchise Agreement") results in immediate termination of this Participation Agreement with respect to the Designated Locations covered by the terminated or expired Franchise Agreement, with no notice required.
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 Franchise Disclosure Document, if the franchisee agreement with Client is terminated or expires, the Participation Agreement is immediately terminated with no notice required. This means that the franchisee's rights and obligations under the Participation Agreement cease at the same time as the franchise agreement.
This condition is important for prospective Dq Treat franchisees to understand because it directly links the viability of the Participation Agreement to the underlying franchise agreement. If the franchise agreement is terminated early due to breach, non-renewal, or any other reason, the Participation Agreement will also end immediately.
This type of clause is relatively standard in franchising, as it ensures that any ancillary agreements tied to the franchise remain in effect only as long as the franchise itself is active. Franchisees should carefully consider the implications of this clause and ensure they fully understand the terms and conditions of both the franchise agreement and the Participation Agreement.