What is the consequence if an Aw franchisee does not cease operations immediately after termination?
Aw Franchise · 2025 FDDAnswer from 2025 FDD Document
nation or expiration (without renewal) of this Agreement, you will immediately cease to use in any business or otherwise the Confidential Information disclosed to you pursuant to this Agreement and will return to us all copies of the Operations Manual, any proprietary software and other materials containing our proprietary information which have been loaned to you by us.
- 16.4 Cease Operations. Upon termination or expiration of this Agreement, you shall immediately cease to operate your Papa Ray's Pizza Restaurant under this Agreement, either as a franchised or as a non-franchised facility.
- 16.5 Assignment of Lease. Upon termination or expiration of this Agreement, at our option you shall immediately assign to us your interest in any lease then in effect for the premises of your Papa Ray's Pizza Restaurant, as you agreed to in the Exhibit 3 Collateral Assignment of Lease.
- 16.6 De-Identification of Premises. Upon termination or expiration of this Agreement, you agree, in the event you continue to operate or subsequently begin to operate any other business (subject to any restrictions against doing so provided in this Agreement), not to use any reproduction, counterfeit, copy or colorable imitation of the Marks either in connection with such other business or the promotion thereof, which is likely to cause confusion, mistake or deception, or which is likely to dilute our exclusive rights in and to the Marks and further agree not to utilize any designation of origin or description or representation which falsely suggests or represents an association or connection with us so as to constitute unfair competition.
Source: Item 22 — CONTRACTS (FDD pages 39–40)
What This Means (2025 FDD)
According to Aw's 2025 Franchise Disclosure Document, if a franchisee fails to cease operations immediately upon termination or expiration of the franchise agreement, Aw has the right to enter the premises and make necessary modifications or alterations to prevent any association between Aw and any subsequent business operated on the premises.
Specifically, Aw can make changes to remove distinctive features that identify the System. If the franchisee fails or refuses to comply with these requirements, Aw has the right to enter the premises, without being guilty of trespass or any other tort, to make the required changes at the franchisee's expense. The franchisee agrees to pay these expenses upon demand.
This means that a franchisee who continues to operate after termination, potentially under a different brand, must remove all branding and identifying features associated with Aw. Failure to do so allows Aw to take action to de-identify the location at the franchisee's cost, which could involve significant expenses for construction and removal of signage and other branded elements.