What is the role of Rayyan Pizza Franchise in the Collateral Assignment of Lease agreement for Aw?
Aw Franchise · 2025 FDDAnswer from 2025 FDD Document
| (a) | Consents | to the | foregoing | Collateral | Assignment | of Lease | executed by ("Assignor") in favor of Rayyan Pizza Franchise |
|---|---|---|---|---|---|---|---|
| Assignor under the Lease within thirty (30) days of notice to Assignee its defaults; and | LLC ("Assignee), and agrees that if Assignee takes possession of the leased premises and confirms to Lessor the assumption of the Lease by Assignee as lessee under it in writing, Lessor shall recognize Assignee as lessee under the Lease, provided that Assignee cures the defaults of that Assignor has not cured | ||||||
| (b) | LESSOR: | under the Lease and who is reasonably acceptable to Lessor, and upon such shall have no further liability or obligation under the Lease as assignee, lessee or otherwise. | Agrees that Assignee may further assign the Lease to a person, firm or corporation who has been granted a franchise by Assignee and who agrees to assume the lessee's obligations assignment Assignee | ||||
| Dated: | CORPORATE SIGNATURE: | ||||||
| ATTEST: | a | corporation | |||||
| By: | By: | ||||||
Source: Item 22 — CONTRACTS (FDD pages 39–40)
What This Means (2025 FDD)
According to Aw's 2025 Franchise Disclosure Document, Rayyan Pizza Franchise LLC acts as the 'Assignee' in the Collateral Assignment of Lease. This means that the franchisee ('Assignor') assigns their rights in the lease to Aw as collateral. This assignment serves as a security measure for Aw, ensuring that they have recourse to the leased premises under certain conditions.
Specifically, if the franchisee defaults on the lease or the Franchise Agreement expires or terminates, Aw has the option to exercise the Collateral Assignment of Lease. If Aw takes possession of the leased premises and confirms in writing to the lessor that it is assuming the lease, the lessor must recognize Aw as the lessee, provided Aw cures any defaults by the franchisee. This protects Aw's interest in maintaining a location for a Papa Ray's Pizza Restaurant.
Furthermore, Aw 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 obligations of the lessee. This provides Aw with flexibility in managing its franchise network and ensuring the continued operation of Papa Ray's Pizza Restaurants. The franchisee must obtain Aw's approval for any lease or sublease of the premises, and Aw can require specific terms and provisions to be included in the lease to protect its interests, such as ensuring the lease term is at least equal to the franchise agreement term and that the premises are only used for a Papa Ray's Pizza Restaurant.