What am I prohibited from doing under the non-competition covenants of the Aw franchise agreement during the term of the franchise?
Aw Franchise · 2025 FDDAnswer from 2025 FDD Document
| PROVISION | SECTION IN FRANCHISE AGREEMENT | SUMMARY |
|---|---|---|
| q. Non-competition covenants | Section 9.3 | No involvement in competing business |
| during the term of the franchise | anywhere. |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER, AND DISPUTE RESOLUTION (FDD pages 34–36)
What This Means (2025 FDD)
According to Aw's 2025 Franchise Disclosure Document, during the term of the franchise agreement, franchisees are prohibited from any involvement in a competing business anywhere. This is per the non-competition covenants outlined in Section 9.3 of the franchise agreement. This restriction is in place for the entire duration of the franchise term.
This means that as an Aw franchisee, you cannot own, operate, or be involved in any other business that competes with Aw, regardless of its location. This is a fairly standard restriction in franchise agreements, designed to protect the brand and prevent franchisees from using Aw's resources and knowledge to benefit a competing business.
It is important to understand the scope of what constitutes a "competing business." Prospective franchisees should carefully review Section 9.3 of the franchise agreement to fully understand the restrictions and ensure they do not inadvertently violate the non-compete clause. Franchisees should seek clarification from Aw regarding any business activities they are considering that might potentially be viewed as competitive.