Can the other fees besides royalty and advertising fees in the renewal agreement for an Aw franchise differ from the initial agreement?
Aw Franchise · 2025 FDDAnswer from 2025 FDD Document
To renew the franchise, the Company, you and your Owners must sign the then-current form of standard franchise agreement, which agreement will replace this Agreement in all respects, and which may contain royalty fees, advertising fees and other fees and provisions that differ from those contained in this Agreement; any ancillary agreements we are then customarily using in the grant or renewal of franchises for the operation
of Papa Ray's Pizza Restaurants (with appropriate modifications to reflect the fact that the agreement relates to the grant of a renewal franchise); and a general release, in a form satisfactory to us, of any and all claims against us and our affiliates, and our respective officers, directors, shareholders, employees, and agents. If either you or any of your Owners refuse to sign those agreements and releases within thirty (30) days after their delivery, you will be deemed to have elected not to renew the Franchise.
Source: Item 22 — CONTRACTS (FDD pages 39–40)
What This Means (2025 FDD)
According to Aw's 2025 Franchise Disclosure Document, the fees in the renewal agreement can differ from the initial agreement. Specifically, to renew the franchise, the franchisee must sign the then-current form of the standard franchise agreement. This new agreement will replace the original agreement and may include royalty fees, advertising fees, and other fees and provisions that are different from those in the initial agreement.
This means that when a franchisee renews their Aw franchise, they cannot assume that the fee structure will remain the same. Aw has the right to modify these fees, potentially increasing costs for the franchisee. The new agreement may also include ancillary agreements that Aw is then using for new or renewed franchises, with modifications to reflect that it is a renewal.
In addition to the modified fees, the franchisee must also sign a general release of any and all claims against Aw and its affiliates. Refusal to sign the new agreements and releases within thirty days of delivery will be deemed as an election not to renew the franchise. Therefore, franchisees need to carefully review the renewal agreement to understand any changes in fees, terms, and conditions, and assess the financial impact of these changes on their business before committing to renew their Aw franchise.