What is the length of the additional renewal term for a Dq Treat license?
Dq_Treat Franchise · 2025 FDDAnswer from 2025 FDD Document
ent is signed as a requirement of renewal
- 4.2 Expiration Date. Company will designate the expiration date of this agreement on the cover page and the date designated by Company shall control.
- 4.3 Renewal. If the following conditions are met, Licensee may renew its license for an additional renewal term, which will be the shorter of 15 years or the period that Licensee has the right to maintain possession of the Restaurant premises:
- (A) Licensee gives Company written notice of its intent to renew between 3 6 months before the expiration of the term;
- (B) Licensee signs Company's then current operating agreement. The terms of the then current operating agreement may differ materially from this agreement, including higher or additional fees;
- (C) Licensee has complied with the modernization and replacement provisions of section 5.5;
- (D) Licensee is in good standing, including that it has satisfied all monetary obligations on a timely basis, and does not have a history of substantial noncompliance with the System or this agreement;
- (E) Licensee has the right to maintain possession of the Restaurant premises, and has provided written proof of its ability to remain in possession of the premises throughout the renewal period if leasing or subleasing;
- (F) Licensee pays Company a non-refundable renewal fee of $1,000 times the number of years (including partial years) included in the renewal term, but not more than $10,000, which is due 30 days before expiration of this agreement. For example, if the renewal operating agreement is for 7½ years, the renewal fee would be $8,000;
- (G) Licensee and each Principal Owner sign a general release, in a form acceptable to Company, of all claims against Company and its affiliates, officers, directors, employees, and agents;
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 Dq Treat's 2025 Franchise Disclosure Document, a licensee may renew their license for an additional term. This additional renewal term will be the shorter of 15 years or the period that the licensee has the right to maintain possession of the restaurant premises.
To be eligible for renewal, the Dq Treat licensee must provide written notice of their intent to renew between 3 and 6 months before the expiration of the current term. They must also sign the company's then-current operating agreement, which may have terms that differ significantly from the original agreement, potentially including higher or additional fees.
Further conditions for renewal include compliance with modernization and replacement provisions, being in good standing with all monetary obligations satisfied on time, and not having a history of substantial noncompliance. The licensee must also prove they have the right to maintain possession of the restaurant premises throughout the renewal period, especially if leasing or subleasing. Finally, the licensee must pay a non-refundable renewal fee of $1,000 times the number of years included in the renewal term, with a maximum fee of $10,000, due 30 days before the agreement expires. For example, a 7½ year renewal would incur an $8,000 renewal fee.
In addition to the above, the licensee and each principal owner must sign a general release of all claims against Dq Treat and its affiliates. Dq Treat must also approve the location where the restaurant will operate during the renewal period. These conditions are typical in franchising, as franchisors want to ensure that franchisees are up-to-date with brand standards, are financially stable, and will not pose any legal risks.