For Dq Treat, can the Licensee offset any claims against amounts due under the agreement?
Dq_Treat Franchise · 2025 FDDAnswer from 2025 FDD Document
Company may reduce the price paid for the assets by any unpaid portion of the termination fee due under section 13.2(D) of this agreement.
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)
Based on the 2025 Dq Treat Franchise Disclosure Document, the company may reduce the price paid for the assets of the restaurant by any unpaid portion of the termination fee due under section 13.2(D) of the agreement. This means that if a franchisee owes a termination fee, Dq Treat can deduct that amount from the price they pay if they purchase the restaurant's assets.
This clause protects Dq Treat's financial interests by ensuring they can recover outstanding termination fees. However, the FDD does not explicitly address whether a franchisee can offset other types of claims they may have against Dq Treat against the amounts they owe the company.
A prospective Dq Treat franchisee should seek clarification from the franchisor regarding whether they can offset any claims against amounts owed under the agreement. Understanding the specific conditions under which offsets are permitted or prohibited is crucial for managing financial obligations and potential disputes during the franchise term.