What is the definition of 'due diligence' in the context of completing required maintenance for a Papa Ray's Pizza Restaurant operated by Aw?
Aw Franchise · 2025 FDDAnswer from 2025 FDD Document
11.8 Specifications, Standards and Procedures. You agree to comply with all mandatory specifications, standards, and operating procedures relating to the appearance, function, cleanliness, sanitation and operation of a Papa Ray's Pizza Restaurant. Mandatory specifications, standards, and operating procedures we prescribe from time to time in the Operations Manual, or otherwise communicated to you in writing, will constitute provisions of this Agreement as if fully set forth in this Agreement. All references to "this Agreement" includes all such mandatory specifications, standards, and operating procedures. The mandatory specifications will include without limitation:
(d) the safety, maintenance, cleanliness, sanitation, function and appearance of the Papa Ray's Pizza Restaurant and the Premises and its fixtures, equipment, furniture, decor, signs, displays, and menu boards;
13.4 Our Right to Inspect the Papa Ray's Pizza Restaurant.
To determine whether you and the Papa Ray's Pizza Restaurant are complying with this Agreement, and with the specifications, standards, and operating procedures we prescribe for the operation of Papa Ray's
Pizza Restaurants, and in order to preserve the validity and integrity of the Marks and to ensure that you are properly using the Marks in the operation of your Papa Ray's Pizza Restaurant, we or our agents have the right, at any reasonable time and without advance notice to you, to: (1) enter and inspect the Premises; (2) observe the operations of the Papa Ray's Pizza Restaurant for such consecutive or intermittent periods as we deem necessary; (3) interview employees of the Papa Ray's Pizza Restaurant; (4) interview customers of the Papa Ray's Pizza Restaurant; (5) to select inventory items, products, materials and supplies for testing and evaluation; and (6) inspect and copy any books, records and documents relating to the operation of the Papa Ray's Pizza Restaurant. You agree to fully cooperate with us in connection with any of those inspections, observations and interviews.
In the event the Premises and/or your operation of your Papa Ray's Pizza Restaurant are rated unacceptable by us or a qualified third party agent designated by us according to published standards for Papa Ray's Pizza Restaurants based on such inspection, you must reimburse us for any and all costs and expenses connected with the inspection (including, without limitation, reasonable compensation for the third party designated agent). Thereafter, we may conduct additional inspections every thirty (30) days ourselves or through a designated third party agent and you must reimburse us for any and all costs and expenses connected with any and all inspections that result in an unacceptable rating for your Premises or business operations. The foregoing remedies shall be in addition to any other remedies we may have for your failure to comply with the terms of this Agreement.
Source: Item 22 — CONTRACTS (FDD pages 39–40)
What This Means (2025 FDD)
Based on the 2025 Franchise Disclosure Document, the term 'due diligence' is not explicitly defined in the context of maintenance requirements for a Papa Ray's Pizza Restaurant operated by Aw. However, the FDD outlines several obligations related to maintaining the restaurant's standards and complying with specific procedures.
Aw franchisees must adhere to mandatory specifications, standards, and operating procedures pertaining to the restaurant's appearance, function, cleanliness, sanitation, and overall operation. These standards are communicated through the Operations Manual or in writing and are considered part of the franchise agreement. This includes maintaining the safety, cleanliness, function, and appearance of the premises, fixtures, equipment, furniture, decor, signs, displays, and menu boards.
To ensure compliance, Aw retains the right to inspect the premises at any reasonable time, without prior notice. These inspections can involve observing operations, interviewing employees and customers, selecting inventory for testing, and reviewing records. If the restaurant receives an unacceptable rating based on these inspections, the franchisee is responsible for reimbursing Aw for the inspection costs and any subsequent inspections until compliance is achieved.
While the FDD does not use the specific term 'due diligence,' it emphasizes the importance of maintaining the Papa Ray's Pizza Restaurant to the standards set by the franchisor. A prospective franchisee should inquire with Aw about specific expectations and procedures related to maintenance to ensure they fully understand their obligations.