What condition must be met for Aw franchisees to be required to reimburse Aw for taxes?
Aw Franchise · 2025 FDDAnswer from 2025 FDD Document
| TYPE OF FEE1,3 | AMOUNT | DUE DATE | REMARKS |
|---|---|---|---|
| Reimbursement of Taxes | Actual assessed taxes against us for your operation of your business or on any payments you make to us. | Upon demand | Only payable if taxes of this type are assessed against us. |
Source: Item 6 — OTHER FEES (FDD pages 13–16)
What This Means (2025 FDD)
According to Aw's 2025 Franchise Disclosure Document, franchisees are only required to reimburse Aw for taxes if taxes are assessed against Aw. Specifically, this applies to taxes related to the franchisee's operation of their business or on any payments the franchisee makes to Aw. If such taxes are assessed against Aw, the franchisee is responsible for reimbursing Aw for the actual amount of those assessed taxes.
This means that Aw franchisees are not automatically responsible for all of Aw's tax obligations. The obligation arises only when specific taxes are levied against Aw due to the franchisee's business activities or payments made to Aw. This condition protects franchisees from unexpected or generalized tax liabilities of the franchisor.
The reimbursement is due upon demand from Aw, meaning that Aw will notify the franchisee when such taxes have been assessed and require payment. It is important for prospective franchisees to understand this potential liability and factor it into their financial planning. Franchisees should maintain accurate records of their payments to Aw and be prepared to cover any tax reimbursements that may arise under these specific circumstances.
While this condition seems reasonable, prospective Aw franchisees should seek clarification during their due diligence. They should ask Aw to provide examples of situations where such taxes might be assessed and how the reimbursement process works in practice. Understanding the potential scope and frequency of this reimbursement will help franchisees better assess the financial implications of operating an Aw franchise.