Under what conditions is a Dq Treat licensee or owner prohibited from retaining a security interest in the transferred property?

According to the 2025 Dq Treat Franchise Disclosure Document, a licensee or owner is prohibited from retaining a security or other financial interest in the property to be transferred without Dq Treat's prior written consent and except upon conditions acceptable to Dq Treat. The licensee must inform Dq Treat if they or an owner proposes to retain a security or other financial interest.

This means that if a Dq Treat franchisee wants to sell their franchise but also wants to maintain some form of financial stake or security interest in the business or its assets after the sale, they must first obtain written permission from Dq Treat. Furthermore, Dq Treat can dictate the specific conditions under which such an arrangement might be allowed.

This provision protects Dq Treat by ensuring they have control over who has a financial interest in their franchises, even after a transfer. It allows Dq Treat to assess the potential risks and ensure that any retained financial interest by the seller does not negatively impact the brand or the new franchisee's operations. Prospective franchisees should be aware that retaining any financial interest in the transferred property is not guaranteed and is subject to Dq Treat's approval and conditions.