Which state's laws govern the Aw Franchise Agreement?
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. |
| p. Death or disability of franchisee | Section 14.4 | Franchise or ownership interest in you must be assigned to approved buyer within 6 months. |
| q. Non-competition covenants | Section 9.3 | No involvement in competing business |
| during the term of the franchise | anywhere. | |
| r. Non-competition covenants after the franchise is terminated or expires | Section 17.1 | No involvement in a competing business for 2 years within 20 miles of your Papa Ray’s Pizza Restaurant or of any other Papa Ray’s Pizza Restaurant (same restrictions apply after assignment). |
| s. Modification of the Agreement | Sections 6.2 and 19.6 | Operations Manual and standards and specifications are subject to change. No modifications to the Franchise Agreement except if in writing and signed by both parties. |
| t. Integration/merger clause | Section 19.6 | Only terms of the Franchise Agreement (including exhibits, attachments, Operations Manual and other written materials) and representations made in this Disclosure Document are binding. |
| u. Dispute resolution by arbitration | Sections 18.1 and | Disputes must be mediated before filing an |
| or mediation | 18.2 | arbitration action. |
| v. Choice of forum | Section 18.4 | Litigation must be in Illinois; subject to state law. |
| w. Choice of law | Section 18.4 | Law of the state of Illinois applies, except franchise laws only apply if you meet jurisdictional requirements, subject to state law. |
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, the laws of Illinois govern the Franchise Agreement. Specifically, Section 18.4 dictates that Illinois state law applies to the agreement. However, there is an exception: franchise laws will only apply if the franchisee meets the jurisdictional requirements of a particular state, and this application is subject to state law.
This means that while Illinois law generally governs the contract, certain franchise-specific laws of the state where the franchisee operates might also apply, depending on whether the franchisee meets that state's legal requirements for such application. This could include laws related to franchise registration, disclosure, or termination, if the franchisee's situation triggers those laws in their state.
For a prospective Aw franchisee, this clause highlights the importance of understanding both Illinois law and the franchise laws of their own state. They should consult with a legal professional to determine how these laws interact and what their rights and obligations are under the Franchise Agreement, considering their specific location and circumstances. This is especially important in states with strong franchise protection laws, as those laws might provide additional rights or impose additional obligations on Aw.