factual

If I transfer my Aw franchise to an entity I control, how much notice must I give to Aw?

Aw Franchise · 2025 FDD

Answer from 2025 FDD Document

PROVISION SECTION SUMMARY
IN FRANCHISE AGREEMENT
h. "Cause" defined – non-curable defaults Section 15.1 Failure to locate site or open Papa Ray's Pizza Restaurant in time required, failure to satisfactorily complete initial training, abandonment, cease operating for 2 or more days, material misrepresentations, conviction of a felony, dishonest or unethical conduct, unauthorized transfers, unauthorized use or disclosure of confidential information or Operations Manual, unauthorized use of Marks, having interest in competing business, creation of a threat to public health or safety not corrected within 24 hours, 3 or more defaults in any 12 month period, failure to attend training or conference 2 or more times, filing for bankruptcy relief.
i. Your obligations on termination/ non-renewal Section 16 Pay outstanding amounts, cease operating, cease using Marks, return items containing Marks, cancel fictitious names, transfer telephone number to us, return of confidential information, assign lease at our option or de identify the restaurant premises (see also o. and r. below)
j. Section 14.1 No restriction on our right to assign.
Assignment of contract by
franchisor.
k. "Transfer" by franchisee – definition Section 14.2. Includes transfer of any interest in Franchise Agreement, Papa Ray's Pizza Restaurant or a substantial portion of its assets or ownership change in franchisee.
l. Franchisor approval of transfer by franchisee Sections 14.2 and 14.3 Except for transfer to entity controlled by you, we have right to approve all transfers, but will not unreasonably withhold approval. Transfer to an entity is effective upon 30 days' notice to us once you sign our assignment agreement and all owners guaranty the franchise agreement obligations of the entity.

Source: Item 17 — RENEWAL, TERMINATION, TRANSFER, AND DISPUTE RESOLUTION (FDD pages 34–36)

What This Means (2025 FDD)

According to Aw's 2025 Franchise Disclosure Document, if you transfer your franchise to an entity you control, you must provide Aw with 30 days' notice. This transfer becomes effective once you sign Aw's assignment agreement and all owners guarantee the franchise agreement obligations of the entity.

This means that a franchisee can transfer their Aw franchise to a business entity that they control, such as an LLC or corporation, without requiring Aw's approval. However, Aw does require 30 days' advance notice to ensure they are informed of the change in ownership structure. This allows Aw to update their records and ensure that the new entity is properly bound by the terms of the franchise agreement.

It is important to note that all owners of the new entity must guarantee the franchise agreement obligations. This means that the individuals behind the entity are personally responsible for ensuring the franchise complies with the agreement. This is a common practice in franchising to ensure that the franchisor has recourse if the franchisee entity fails to meet its obligations. Prospective Aw franchisees should carefully review the assignment agreement and understand the implications of providing a personal guarantee.

Disclaimer: This information is extracted from the 2025 Franchise Disclosure Document and is provided for research purposes only. It does not constitute legal or financial advice. Consult with a franchise attorney before making any investment decisions.