What happens if the interest of a deceased or disabled Aw franchisee is not transferred within the required timeframe?
Aw Franchise · 2025 FDDAnswer from 2025 FDD Document
- 14.4 Death or Disability of Franchisee. Upon the death or permanent disability of you (or any of your Owners), the executor or other personal representative of such person must transfer such person's interest within a reasonable time, not to exceed six (6) months from the date of death or permanent disability, to a person approved by us. Such transfers, including, without limitation, transfers by devise or inheritance, will be subject to all the terms and conditions for assignments and transfers contained in Paragraphs 14.2 and 14.3. Failure to transfer such interest within the required period of time will constitute grounds for termination under Section 15. Prior to such transfer, the executor or other personal representative of such person, or the remaining Owners, must appoint a competent manager within a reasonable time, not to exceed thirty (30) days from the date of death or permanent disability. The appointment of this manager is subject to our prior written approval, and this manager must, if requested by us, attend and satisfactorily complete our training program. If Papa Ray's Pizza Restaurant is not being managed by a manager approved by us within thirty (30) days after the death or permanent disability, we are authorized, but we are not required, to immediately appoint a manager to maintain the operations of Papa Ray's Pizza Restaurant. Our appointment of a manager for your Papa Ray's Pizza Restaurant will not relieve you of your obligations under this Agreement, and we will not be liable for any debts, losses, costs or expenses incurred in the operation of your Papa Ray's Pizza Restaurant or to any of your creditors for any products, materials, supplies or services purchased by your Papa Ray's Pizza Restaurant during any period in which it is managed by the manager appointed by us. We have the right to charge a reasonable non-refundable fee for such management services and to cease providing such management services at any time.
Source: Item 22 — CONTRACTS (FDD pages 39–40)
What This Means (2025 FDD)
According to Aw's 2025 Franchise Disclosure Document, if a franchisee (or any of their owners) dies or becomes permanently disabled, their interest must be transferred within six months to a person approved by Aw. The executor or personal representative is also required to appoint a competent manager within 30 days of the death or disability, subject to Aw's approval, who may be required to complete Aw's training program.
Failure to transfer the interest within the six-month timeframe constitutes grounds for termination of the franchise agreement. This means Aw has the right to terminate the agreement if the transfer is not completed on time.
If a manager approved by Aw is not appointed within 30 days, Aw is authorized, but not required, to appoint a manager to maintain operations. Aw can charge a reasonable, non-refundable fee for these management services and can cease providing them at any time. It is important to note that Aw's appointment of a manager does not relieve the franchisee of their obligations under the agreement, and Aw is not liable for any debts, losses, costs, or expenses incurred during their management.