Does Aw need to provide notice to the franchisee before terminating the agreement for failing to comply with operating procedures?
Aw Franchise · 2025 FDDAnswer from 2025 FDD Document
nsent to the termination or expiration of this Agreement, or any other relief which we may seek in a complaint to lift the provisions of any automatic stay under any bankruptcy rules. In addition, you (and your Owners) agree not to seek any injunctive relief from any court in any jurisdiction which would have the effect of staying or enjoining this provision.
- 15.2 By the Company With Opportunity to Cure. We have the right to terminate this Agreement upon written notice to you if you (or any of your Owners):
- (a) fail to accurately report the Gross Revenue of your Papa Ray's Pizza Restaurant or to timely pay royalty fees, marketing fund contributions, or other payments due to us or our affiliates, and do not correct such failure within ten (10) days after written notice of such failure is delivered to you;
- (b) commit any act or omission of default under the lease for the Premises and do not cure the default within the applicable cure period set forth in the lease;
- (c) fails to meet the minimum Gross Revenue requirement described in Section 2.7 above following notice and a twelve (12) month period in which to increase the Gross Revenue in order to meet the required minimum Gross Revenue requirement; or
- (d) fail to comply with any other provision of this Agreement or any mandatory specification, standard or operating procedure we prescribe from time to time, and do not correct such failure within thirty (30) days after written notice of such failure to comply is delivered to you. If such breach cannot be reasonably be cured within such thirty (30) day period and if you commence a bona fide program to cure such breach within thirty (30) days and continue to take such actions as are necessary to complete such cure until completed, you will be given the reasonable amount of time required to complete the cure. If you fail to continue to take the necessary action to cure or you do not complete the cure within the reasonable period, then we may terminate this Agreement effective
upon delivery to you of written notice that such breach has not been cured in a reasonable time and we are electing to terminate.
15.3 Right to Operate Upon Default. In addition to our right to terminate this Agreement and not in lieu of such right or any other rights, in the event that you have not cured a default under this Agreement within fourteen (14) days after receipt of a written notice of default, we may, at our option, enter upon the Premises and exercise complete authority with respect to the operation of your Papa Ray's Pizza Restaurant until such time as we determine that the default has been cured and that there is compliance with the requirements of this Agreement. You acknowledge and agree that our agent or other representative designated by us may take over, control and operate your Papa Ray's Pizza Restaurant, that you shall pay us the then-current published fee for such management service, plus all travel expenses, room and board and other expenses reasonably incurred by such agent or representative so long as it shall be required to enforce compliance with this Agreement.
Source: Item 22 — CONTRACTS (FDD pages 39–40)
What This Means (2025 FDD)
According to Aw's 2025 Franchise Disclosure Document, Aw may terminate the franchise agreement if the franchisee fails to comply with any provision of the agreement or any mandatory specification, standard, or operating procedure. However, Aw must provide written notice of the failure and allow 30 days for the franchisee to correct it. If the breach cannot be reasonably cured within 30 days, Aw will allow a reasonable amount of time to complete the cure, provided the franchisee commences a bona fide program to cure the breach within 30 days and continues to take necessary actions to complete the cure. Aw can terminate the agreement if the franchisee fails to continue the cure or does not complete it within a reasonable period. Aw will provide written notice that the breach has not been cured in a reasonable time and that they are electing to terminate the agreement.
However, Aw can terminate the agreement without notice if the franchisee presents a bankruptcy petition or if a bankruptcy petition is filed against the franchisee and not dismissed within 60 days. Also, if the franchisee violates anti-terrorism laws, Aw can terminate the agreement immediately.
Additionally, if a franchisee fails on three or more separate occasions within any 12 consecutive month period to comply with the agreement or mandatory operating procedures, Aw can terminate the agreement, regardless of whether the failures are corrected after notice. This highlights the importance of consistent compliance with Aw's standards to avoid potential termination.