If an Aw franchisee participates in a cooperative advertising program, does the franchisor, Aw, assume any liability to the franchisee regarding the cooperative's administration?

According to Aw's 2025 Franchise Disclosure Document, Aw assumes no liability to franchisees regarding the administration of advertising cooperatives. While franchisees are required to participate in local or regional advertising cooperatives if one is formed and approved by Aw, the franchisor explicitly states it has no direct or indirect liability concerning the cooperative's maintenance, direction, or administration. This includes instances where other franchisees fail to make their required contributions.

This lack of liability means that if the cooperative is mismanaged or ineffective, Aw franchisees cannot hold Aw responsible. The franchisees themselves, through a majority vote within the cooperative, determine the amount and manner of contributions. Each Papa Ray's Pizza Restaurant in the cooperative, whether franchised, company-owned, or affiliate-owned, has one vote.

Franchisees should be aware that while contributions to the cooperative count toward their local advertising expenditure requirements, Aw does not guarantee the cooperative's success or proper management. It is crucial for franchisees to actively participate in the cooperative's decision-making processes to protect their interests, as Aw's role is limited to approval and not direct oversight or liability.