What is the consequence if an Aw franchisee fails to comply with any mandatory specification?
Aw Franchise · 2025 FDDAnswer from 2025 FDD Document
rom the construction, maintenance or operation of your Papa Ray's Pizza Restaurant and upon receipt of written or oral notice from us or governmental authority of the existence of such threat or danger, you fail to immediately cease any activity or conduct causing the threat or danger and fail to complete the cure of such breach within twenty-four (24) hours;
- (i) fail on three (3) or more separate occasions within any twelve (12) consecutive month period to submit when due financial statements, reports or other data, information or supporting records, to pay when due the royalty fees, marketing fund contributions, other payments due to us or to pay amounts due to other persons, or otherwise fail to comply with this Agreement, or with any mandatory specification, standard or operating procedures we prescribe from time to time, whether or not such failures to comply are corrected after notice of those failures to comply is delivered to you; and
(j) fail on two (2) or more occasions during any calendar year to attend and complete any mandatory supplemental education or conference required by Paragraph 5.3 or Paragraph 5.4 of this Agreement.
This Agreement will expire automatically without notice upon the presentation for filing by you (or any of your Owners) of a petition or application seeking any type of relief under the Federal Bankruptcy Act or any state insolvency or similar law.
Source: Item 22 — CONTRACTS (FDD pages 39–40)
What This Means (2025 FDD)
According to Aw's 2025 Franchise Disclosure Document, failure to comply with mandatory specifications, standards, or operating procedures can lead to termination of the franchise agreement. Specifically, if an Aw franchisee fails to comply with any mandatory specification, standard, or operating procedure prescribed by Aw, and does not correct such failure within thirty (30) days after receiving written notice, Aw has the right to terminate the agreement.
However, if the breach cannot be reasonably cured within the initial thirty-day period, Aw will allow a reasonable amount of time to complete the cure, provided the franchisee commences a bona fide program to cure the breach within thirty (30) days and continues to take necessary actions until the cure is completed. If the franchisee fails to continue these actions or does not complete the cure within a reasonable period, Aw can terminate the agreement effective upon written notice.
Additionally, the agreement can be terminated if the franchisee fails on three or more separate occasions within any twelve-month period to comply with any mandatory specification, standard, or operating procedures, regardless of whether the failures are corrected after notice. This highlights the importance of adhering to Aw's operational guidelines and maintaining consistent compliance to avoid potential termination of the franchise agreement.