What is the effect of the expiration of the Franchise Agreement on the Collateral Assignment of Lease for Aw?

According to Aw's 2025 Franchise Disclosure Document, the Collateral Assignment of Lease is directly affected by the expiration of the Franchise Agreement. Specifically, upon the expiration of the Franchise Agreement, Aw has the option to require the franchisee to assign their interest in the lease for the restaurant premises to Aw. This is part of the agreement outlined in Exhibit 3, the Collateral Assignment of Lease.

However, if Aw does not choose to take assignment of the lease upon the expiration or termination of the Franchise Agreement, the franchisee must immediately make modifications to the premises to eliminate any association between Aw or its system and any subsequent business operated at the location. These modifications may include removing distinctive physical and structural features that identify the Aw system. If the franchisee fails to comply with these requirements, Aw has the right to enter the premises and make the necessary changes at the franchisee's expense.

Furthermore, the document states that the Collateral Assignment of Lease remains in effect for the full term of the lease and any renewal or extension terms. Upon the expiration of the lease, the assignment becomes null and void. This indicates that the assignment is tied to the duration of the lease agreement itself, regardless of the status of the Franchise Agreement, but Aw's rights to enforce the assignment are triggered by the termination or expiration of the Franchise Agreement.