Does Aw have the right of first refusal to acquire my business?
Aw Franchise · 2025 FDDAnswer from 2025 FDD Document
| PROVISION | SECTION IN FRANCHISE AGREEMENT | SUMMARY |
|---|---|---|
| n. Franchisor’s right of first refusal | Section 14.6 | We can match any offer for your business or an |
| to acquire franchisee’s business | ownership interest in you. | |
| o. Franchisor’s option to purchase franchisee’s business | Section 16.7 | We may within 30 days of termination or expiration purchase certain assets of your Papa Ray’s Pizza Restaurant at lesser of cost or fair market value. |
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, Aw does have the right of first refusal if a franchisee decides to sell their business. Specifically, Aw has the right to match any offer made for the business or for an ownership interest in the business. This is detailed in Section 14.6 of the franchise agreement.
This right of first refusal means that if a franchisee receives an offer from a third party to buy their Aw franchise, the franchisee must first give Aw the opportunity to purchase the franchise on the same terms as the third party's offer. The franchisee cannot simply accept the third party's offer without giving Aw a chance to match it. This provision allows Aw to maintain control over who becomes a franchisee and to potentially consolidate ownership within the franchise system.
In addition to the right of first refusal, Aw also has the option to purchase certain assets of the Papa Ray’s Pizza Restaurant within 30 days of termination or expiration of the franchise agreement. In this case, the purchase price would be the lesser of the cost or the fair market value of the assets. This is detailed in Section 16.7 of the franchise agreement.
These provisions regarding the right of first refusal and the option to purchase assets are important for prospective franchisees to understand, as they affect the franchisee's ability to sell the business to a third party and what happens to the business upon termination or expiration of the franchise agreement.