Under what circumstances will Dq Treat refund the transfer fee to the licensee?
Dq_Treat Franchise · 2025 FDDAnswer from 2025 FDD Document
- (2) Refund. If Company exercises its right of first refusal or does not consent to a proposed transfer, Company will return the transfer fee to Licensee, minus any actual expenditures or disbursements made by Company in direct connection with evaluating or processing the proposed transfer, together with an itemized statement of these costs.
The transfer fee is not refundable in whole or in part except as expressly stated in 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)
According to the 2025 Dq Treat Franchise Disclosure Document, a refund of the transfer fee is possible under specific conditions. If Dq Treat exercises its right of first refusal regarding a proposed transfer, or if Dq Treat does not consent to a proposed transfer, the company will return the transfer fee to the licensee. However, Dq Treat will deduct any actual expenditures or disbursements the company made while evaluating or processing the proposed transfer. The refund will be accompanied by an itemized statement of these costs.
It is important to note that the transfer fee is generally non-refundable, except in the specific situations outlined in the agreement. This means that if a transfer does not proceed for other reasons, such as the licensee changing their mind or the transferee being unable to meet the requirements, the transfer fee will likely not be refunded.
This policy is fairly standard in the franchise industry, as franchisors often incur costs when reviewing potential transfers. By reserving the right to deduct expenses, Dq Treat ensures it is not out-of-pocket for costs incurred during the transfer process when the transfer does not ultimately occur due to issues within Dq Treat's control.