Under what circumstances can Aw require a franchisee to modify or discontinue the use of a Mark?
Aw Franchise · 2025 FDDAnswer from 2025 FDD Document
- 7.5 Discontinuance of Use of Marks. If it becomes advisable at any time, in our sole discretion, for you to modify or discontinue use of any Mark or for your Papa Ray's Pizza Restaurant to use one or more additional or substitute trademarks, service marks, trade dress or domain names, you agree to comply with our directions to modify or otherwise discontinue the use of the Mark, or use one or more additional or substitute trademarks, service marks, trade dress or domain names, within a reasonable time after our notice to you at your expense. If we require you to modify or discontinue use of any Mark, we have no obligations or liability to you for your actual expenditures or other costs you incur in order to comply with this obligation.
- 7.6 Indemnification of Franchisee. We agree to indemnify you against, and to reimburse you for, all damages (but specifically excluding any consequential damages, including, but not limited to, loss of revenue and/or profits) for which you are held liable in any proceeding brought against you by any third party arising out of your use of any Mark, so long as said use is pursuant to and in compliance with this Agreement, and for all costs you reasonably incur in the defense of any such claim in which you are named as a party, so long as you have timely notified us of the claim and have otherwise complied with this Agreement. We have the sole right to defend any such claim.
Source: Item 22 — CONTRACTS (FDD pages 39–40)
What This Means (2025 FDD)
According to Aw's 2025 Franchise Disclosure Document, Aw has the authority to direct a franchisee to modify or discontinue the use of any Mark. This also applies to requiring the franchisee's Papa Ray's Pizza Restaurant to use additional or substitute trademarks, service marks, trade dress, or domain names. This decision is based on Aw's sole discretion if it becomes advisable to do so.
The franchisee is obligated to comply with Aw's directions within a reasonable time frame after receiving notice. The franchisee is responsible for covering the expenses associated with these changes. It's important to note that Aw assumes no liability for the franchisee's actual expenditures or other costs incurred as a result of complying with the requirement to modify or discontinue the use of any Mark.
However, Aw does agree to indemnify the franchisee against damages for which the franchisee is held liable in any proceeding brought against them by a third party arising out of the franchisee’s use of any Mark, provided that the franchisee's use is in compliance with the Franchise Agreement. This indemnification specifically excludes any consequential damages, such as loss of revenue or profits. Aw also covers the costs reasonably incurred by the franchisee in defending against such claims, provided that Aw is promptly notified of the claim and the franchisee complies with the agreement. Aw retains the sole right to defend any such claim.