What information regarding arbitration under the Dq Treat franchise agreement is prohibited from disclosure?
Dq_Treat Franchise · 2025 FDDAnswer from 2025 FDD Document
provision supersedes any other term of any document executed in connection with the franchise.
ADDENDUM TO DISCLOSURE DOCUMENT *U*FOR THE STATE OF ILLINOIS
The following information applies to franchises and franchisees subject to the Illinois Franchise Disclosure Act of 1987. Item numbers correspond to those in the main body.
1. UCover Page and Item 17U.
For Illinois franchisees, Illinois law, 815 ILCS 705/19 and 705/20, governs the franchise agreement. The conditions under which the franchise can be terminated and rights upon nonrenewal may be affected by Illinois law. Any provision in a franchise agreement that designates jurisdiction or venue in a forum outside of Illinois is void provided that a franchise agreement may provide for arbitration in a forum outside Illinois.
2. Item 17.
- A. Section 41 of the Illinois Franchise Disclosure Act states that "any condition, stipulation, or provision purporting to bind any person acquiring any franchise to waive compliance with any provision of this Act is void." To the extent that any provision in the Operating Agreement is inconsistent with Illinois law, Illinois law will control.
- B. Any release of claims or acknowledgments of fact contained in the Operating Agreement that would negate or remove from judicial review any statement, misrepresentation or action that would violate the Illinois Franchise Disclosure Act, or a rule or order under the Illinois Franchise Disclosure Act will be void and are deleted with respect to claims under the Illinois Franchise Disclosure Act.
3. Item 21.
You have not been provided with financial statements of ADQ, the Franchisor. Therefore, you do not have knowledge of how this specific company has performed. However, IDQ, the parent corporation of ADQ, unconditionally guarantees the performance of ADQ. A copy of the Guaranty of Performance is on file with the Attorney General.
ADDENDUM TO DISCLOSURE DOCUMENT FOR THE STATE OF MARYLAND
The following applies to franchises and franchisees subject to Maryland statutes and regulations. Item numbers correspond to those in the main body.
1. Item 17
Item 17 of the disclosure document is supplemented by the following:
- (a) Our termination of the Franchise Agreement because of your bankruptcy may not be enforceable under applicable federal law (11 U.S.C.A. 101 et seq.)
- (b) Any claims under the Maryland Franchise Registration and Disclosure Law may be brought in the State of Maryland.
- (c) Any claims arising under the Maryland Franchise Registration and Disclosure Law must be brought within 3 years after the franchise is granted.
- (d) The general release required as a condition of renewal, sale and/or assignment or transfer will not apply to any liability under the Maryland Franchise Registration and Disclosure Law.
2. Additional Disclosure
No statement, questionnaire, or acknowledgment signed or agreed to by a franchisee in connection with the commencement of the franchise relationship shall have the effect of (i) waiving any claims under any applicable state franchise law, including fraud in the inducement, or (ii) disclaiming reliance on any statement made by any franchisor, franchise seller, or other person acting on behalf of the franchisor. This provision supersedes any other term of any document executed in connection with the franchise.
ADDENDUM TO DISCLOSURE DOCUMENT *U*FOR THE STATE OF MINNESOTA
The following applies to franchises and franchisees subject to Minnesota statutes and regulations. Item numbers correspond to those in the main body.
1. Cover Page and Item 17.
Minn. Stat. Sec. 80C.21 and Minn. Rule 2860.4400J prohibit ADQ from requiring litigation to be conducted outside of Minnesota, requiring waiver of a jury trial, requiring you to consent to injunctive relief, or requiring you to consent to liquidated damages, termination penalties or judgment notes. In addition, nothing in the Disclosure Document shall abrogate or reduce any of your rights as provided for in Minn. Stat. Sec. 80C, or your rights to any procedure, forum or remedies provided for by the laws of the jurisdiction.
2. Item 13.
ADQ will undertake the defense of any claim of infringement by third parties involving the Dairy Queen® Trademark. You must cooperate with the defense in any reasonable manner prescribed by ADQ with any direct costs of such cooperation to be borne by ADQ.
3. Item 17.
- A. Minnesota law provides you with certain termination and nonrenewal rights. As of the date of this Disclosure Document, Minn. Stat. Sec. 80C.14, Subds. 3, 4 and 5 require, except in certain specified cases, that you be given 90 days notice of termination (with 60 days to cure) and 180 days notice for nonrenewal of the Operating Agreement, and that consent to the transfer of the franchise will not be unreasonably withheld.
- B. Minnesota Rule 2860.4400D prohibits a franchisor from requiring a franchisee to assent to a general release, assignment, novation, or waiver that would relieve any person from liability imposed by Minnesota Statute §§80C.01 – 80C.22.
- C. The limitations of claims section must comply with Minn. Stat. Sec. 80C.17, subd.5.
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- No statement, questionnaire, or acknowledgement signed or agreed to by a franchisee in connection with the commencement of the franchise relationship shall have the effect of (i) waiving any claims under any applicable state franchise law, including, fraud in the inducement, or (ii) disclaiming reliance on any statement made by any franchisor, franchise seller, or other person acting on behalf of the franchisor. This provision supersedes any other term of any document executed with the franchise.
ADDENDUM TO DISCLOSURE DOCUMENT *U*FOR THE STATE OF NORTH DAKOTA
The following information applies to franchises and franchisees subject to North Dakota statutes and regulations. Item numbers correspond to those in the main body.
1. UItem 6U.
The North Dakota Securities Commissioner has determined that to require franchisees to consent to liquidated damages or termination penalties is unfair, unjust, or inequitable within the intent of the North Dakota Franchise Investment Law. As a result, the termination fee provision in Item 6 of the Disclosure Document is deleted in its entirety.
2. Item 17.
- A. Covenants not to compete during the term of and upon termination or expiration of the Operating Agreement are enforceable only under certain conditions according to North Dakota law.
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, specific disclosures regarding arbitration are addressed in addenda for Illinois, North Dakota, and Washington.
For Illinois franchisees, the FDD states that any condition, stipulation, or provision that requires a franchisee to waive compliance with any provision of the Illinois Franchise Disclosure Act is void. Additionally, any release of claims or acknowledgments in the Operating Agreement that would remove from judicial review any statement, misrepresentation, or action violating the Illinois Franchise Disclosure Act will be void. However, the franchise agreement may still provide for arbitration in a forum outside Illinois.
For North Dakota franchisees, any provision requiring franchisees to consent to the jurisdiction of courts outside North Dakota or to consent to the application of laws of a state other than North Dakota may be unenforceable under North Dakota law. The FDD also notes that the Operating Agreement includes a waiver of exemplary and punitive damages, and a waiver of trial by jury, which may not be enforceable under North Dakota law. For Washington franchisees, a release or waiver of rights executed by a licensee may not include rights under the Washington Franchise Investment Protection Act or any rule or order thereunder except when executed pursuant to a negotiated settlement after the agreement is in effect and where the parties are represented by independent counsel.