What is the role of the Assignee (LLC) in the Collateral Assignment of Lease agreement for Aw?
Aw Franchise · 2025 FDDAnswer from 2025 FDD Document
| KNOW ALL MEN BY THESE PRESENTS, that, a ("Assignor"), does hereby assign, transfer and set over unto |
|---|
| Rayyan Pizza Franchise LLC, an Illinois limited liability company (the "Assignee"), all of Assignor's |
| right, title and interest as tenant in, to and under that certain lease or sublease (collectively, the |
| "Lease") dated, 20 between Assignor, as tenant, and |
| as landlord or sublessor, |
| for the premises known as |
| This Assignment is for collateral purposes only, and except as specified herein, Assignee shall |
| have no liability or obligation of any kind whatsoever arising from or in connection with this |
| Assignment or the lease unless Assignee shall elect to assume the rights and obligations of Assignor |
| under the Lease. Assignee shall make such election by mailing written notice of such election to |
| Lessor and Assignor by United States Certified Mail, duly addressed and posted or by reputable |
| overnight commercial delivery service. |
| Assignor represents and warrants to Assignee that it has full power and authority to assign the |
| Lease and its interests therein and that Assignor has not previously and is not obligated to, assign or |
| transfer any of its interests in the Lease or the premises demised thereby. |
| This Assignment is given to Assignee to secure the faithful performance by Assignor of the |
| terms and conditions of the Franchise Agreement dated the day of, |
| 20, between Assignor and Assignee (the "Franchise Agreement"). Upon a default by Assignor |
| under the Lease, a default by Assignor under the Franchise Agreement, or the expiration or |
| termination of the Franchise Agreement, Assignee shall have the right and is hereby empowered, |
| upon ten (10) days' notice to the Assignor, to assume the above-referenced Lease and take possession |
| of the premises. |
Source: Item 22 — CONTRACTS (FDD pages 39–40)
What This Means (2025 FDD)
According to Aw's 2025 Franchise Disclosure Document, the Assignee, Rayyan Pizza Franchise LLC, plays a crucial role in the Collateral Assignment of Lease agreement. This agreement allows Aw, as the franchisor/assignee, to secure its interests in the franchisee's (assignor's) lease. The assignment is for collateral purposes, meaning Aw has no liability or obligation related to the lease unless it chooses to assume the franchisee's rights and obligations by providing written notice to both the lessor and the franchisee.
Specifically, the franchisee assigns their rights, title, and interest in the lease to Aw. This secures the franchisee's faithful performance of the Franchise Agreement. If the franchisee defaults under the lease or the Franchise Agreement, or upon the expiration or termination of the Franchise Agreement, Aw has the right to assume the lease and take possession of the premises after giving the franchisee ten days' notice.
Furthermore, the lessor agrees to recognize Aw as the lessee if Aw takes possession of the leased premises and confirms in writing that it is assuming the lease, provided Aw cures any defaults the franchisee has not cured. Aw also has the right to further assign the lease to another franchisee who has been granted a franchise by Aw and who agrees to assume the lessee's obligations. This setup ensures that Aw can maintain control over the location of its franchises and continue operations even if a franchisee fails to meet their obligations.