Does the franchise agreement for Aw confer any goodwill or other interests in the Marks to the franchisee?
Aw Franchise · 2025 FDDAnswer from 2025 FDD Document
7.1 Ownership and Goodwill of Marks. You acknowledge that we own the Marks and that your right to use the Marks is derived solely from this Agreement and is limited to your operation of your Papa Ray's Pizza Restaurant pursuant to and in compliance with this Agreement and all applicable specifications, standards and operating procedures we prescribe from time to time during the term of the franchise. Any unauthorized use of the Marks by you will constitute an infringement of our rights in and to the Marks. You acknowledge and agree that all usage of the Marks by you and any goodwill established by your use of the Marks will inure to our exclusive benefit of and that this Agreement does not confer any goodwill or other interests in the Marks on you (other than the right to operate a Papa Ray's Pizza Restaurant in compliance with this Agreement).
You must not, at any time during the term of this Agreement or after its termination or expiration do any of the following: (1) make any oral or written representation or admission that any of the Marks is in any way invalid or infringes the rights of any person or is open to any other form of attack, (2) contest the validity or ownership of any of the Marks or assist any other person in contesting the validity or ownership of the Marks, or (3) take any action that derogates, tarnishes or dilutes our claimed rights in and to the Marks.
Source: Item 22 — CONTRACTS (FDD pages 39–40)
What This Means (2025 FDD)
According to Aw's 2025 Franchise Disclosure Document, the franchise agreement does not confer any goodwill or other interests in the Marks to the franchisee. The agreement explicitly states that Aw owns the Marks, and the franchisee's right to use them is solely derived from the franchise agreement. This right is limited to the operation of a Papa Ray's Pizza Restaurant in compliance with the agreement's specifications, standards, and operating procedures. Any unauthorized use of the Marks by the franchisee is considered an infringement of Aw's rights.
The agreement specifies that all usage of the Marks by the franchisee and any goodwill established through that use will exclusively benefit Aw. The franchisee acknowledges this and agrees that the franchise agreement does not grant them any goodwill or other interests in the Marks beyond the right to operate a Papa Ray's Pizza Restaurant according to the agreement. This means that any positive brand recognition or customer loyalty generated by the franchisee's efforts ultimately belongs to Aw.
Furthermore, the franchisee is prohibited from taking any actions that could harm Aw's rights to the Marks. This includes contesting the validity or ownership of the Marks, assisting others in doing so, or taking any action that could dilute or tarnish Aw's claimed rights. These restrictions apply both during the term of the agreement and after its termination or expiration. This ensures that Aw maintains complete control over its brand and reputation, even after a franchisee leaves the system.