What happens to the initial franchise agreement upon renewal of an Aw franchise?
Aw Franchise · 2025 FDDAnswer from 2025 FDD Document
- 3.3 Renewal Agreement; Releases.
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 initial franchise agreement is replaced upon renewal. To renew the franchise, the franchisee, the Company, and the Owners must sign the then-current form of standard franchise agreement. This new agreement supersedes the original agreement in all respects and may include different royalty fees, advertising fees, other fees, and provisions.
In addition to the new franchise agreement, franchisees must also sign any ancillary agreements that Aw is then using for new or renewal franchises, modified to reflect that the agreement is for a renewal. Franchisees must also sign a general release, in a form satisfactory to Aw, of any and all claims against Aw, its affiliates, and their respective officers, directors, shareholders, employees, and agents.
If the franchisee or any of their owners refuse to sign the new agreements and releases within thirty (30) days after their delivery, the franchisee will be deemed to have elected not to renew the franchise. This means that Aw has the right to change the terms of the franchise agreement upon renewal, which is a fairly common practice in franchising. Prospective franchisees should carefully review the terms of the renewal agreement to understand any changes to their obligations or Aw's obligations.