If Aw appoints a manager after the death or disability of a franchisee, does this relieve the franchisee of their obligations under the Aw agreement?
Aw Franchise · 2025 FDDAnswer from 2025 FDD Document
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, the appointment of a manager by Aw following the death or permanent disability of a franchisee does not relieve the franchisee of their obligations under the franchise agreement. This means that the franchisee's estate or remaining owners are still responsible for fulfilling the terms of the agreement, even while the manager is in place. This includes financial obligations and adherence to operational standards.
Aw's appointment of a manager is intended to maintain the operations of the Papa Ray's Pizza Restaurant during the transition period. However, Aw is not liable for any debts, losses, costs, or expenses incurred during the period the manager is in place, nor are they liable to the franchisee's creditors for any purchases made by the restaurant during this time. This clarifies that Aw's role is strictly to maintain operations, not to assume financial responsibility for the business.
The document also states that Aw has the right to charge a reasonable, non-refundable fee for these management services and can cease providing these services at any time. This provides Aw with the flexibility to manage the restaurant as needed while ensuring they are compensated for their efforts. For a prospective franchisee, this highlights the importance of having a succession plan in place to ensure a smooth transition in the event of death or disability, as the financial and operational responsibilities remain with the franchisee's estate or owners.