Is an Aw franchisee prohibited from entering into joint venture relationships for any restaurant business offering similar products or services to Papa Ray's Pizza?

According to Aw's 2025 Franchise Disclosure Document, during the term of the franchise agreement, franchisees are restricted from engaging in certain business activities. Specifically, franchisees cannot have an interest in any entity that is granting franchises or licenses or entering into joint venture relationships for any restaurant business which offers products or services similar to those offered by a Papa Ray's Pizza Restaurant.

This restriction aims to prevent franchisees from being involved in competitive businesses that could potentially undermine the Aw system. However, there is an exception: franchisees can own securities traded on a stock exchange or on the over-the-counter market that represent 5% or less of that class of securities. This allows franchisees to make minor investments in publicly traded companies without violating the franchise agreement.

This clause ensures that Aw franchisees remain dedicated to the brand and do not divert their resources or expertise to competing ventures. It protects Aw's market position and the integrity of its franchise system by preventing franchisees from supporting or operating similar restaurant businesses, either directly or through joint ventures.