Does Aw's acceptance of payments due from the franchisee after a breach of the franchise agreement constitute a waiver of Aw's rights?
Aw Franchise · 2025 FDDAnswer from 2025 FDD Document
Neither you nor the Company will be deemed to have waived or impaired any right, power or option reserved by this Agreement (including, without limitation, the right to demand exact compliance with every term, condition and covenant herein, or to declare any breach thereof to be a default and to terminate the Franchise prior to the expiration of its terms), by virtue of: (1) any custom or practice of the parties at variance with the terms hereof; (2) any failure, refusal or neglect of either of us to exercise any right under this Agreement or to insist upon exact compliance by the other with its obligations hereunder, including, without limitation, any mandatory specification, standard or operating procedure; (3) any waiver, forbearance, delay, failure or omission by us to exercise any
right, power or option, whether of the same, similar or different nature, with respect to other Papa Ray's Pizza Restaurants; or (4) the acceptance by us of any payments due from you after any breach of this Agreement.
Source: Item 22 — CONTRACTS (FDD pages 39–40)
What This Means (2025 FDD)
According to Aw's 2025 Franchise Disclosure Document, Aw's acceptance of payments from a franchisee after a breach of the franchise agreement does not constitute a waiver of Aw's rights. Specifically, Aw retains the right to demand exact compliance with all terms, conditions, and covenants within the agreement, and to declare any breach a default, even if payments are accepted after the breach occurs. This protects Aw's ability to enforce the franchise agreement fully, regardless of whether they continue to accept payments.
This provision is important for prospective Aw franchisees because it clarifies that continued payment acceptance by Aw does not forgive any prior breaches of the agreement. Aw can still pursue remedies for those breaches, including termination of the franchise, even while accepting ongoing payments. Franchisees should be aware that maintaining compliance with all aspects of the franchise agreement is crucial, as Aw's acceptance of payments does not imply a waiver of their right to enforce the agreement's terms.
This type of clause is relatively common in franchise agreements, as it protects the franchisor's ability to maintain control over the franchise system and enforce brand standards. Franchisees should carefully review the entire franchise agreement to understand all of their obligations and the potential consequences of non-compliance. It is advisable to seek legal counsel to fully understand the implications of such clauses and how they may affect the franchisee's rights and responsibilities.