Under what conditions can an Aw franchisee renew their franchise agreement?
Aw Franchise · 2025 FDDAnswer from 2025 FDD Document
ivery of written notice to you, and thereafter, we may establish another Papa Ray's Pizza Restaurant in the former Protected Area or (iii) terminate this Agreement upon delivery of written notice to you.
3. RENEWAL OF FRANCHISE
- 3.1 Franchisee's Right to Renew. Subject to the provisions of Paragraph 3.2 below, and if you have substantially complied with all provisions of this Agreement and any other agreement between us, then on expiration of the initial term of the Franchise, you will have the right to renew the Franchise for one (1) additional successive term of ten (10) years if: (1) you maintain possession of the Premises, or (2) you are unable to maintain possession of the Premises or in our judgment the Papa Ray's Pizza Restaurant should be relocated, and you secure an approved substitute premises and agree to expeditiously develop the substitute premises in compliance with specifications and standards then applicable under new or renewal franchises for Papa Ray's Pizza Restaurants. You and your Owners must also comply with our then-current training requirements and attend such training classes as we deem necessary. We will charge you a renewal fee of Two Thousand Five Hundred Dollars ($2,500.00) for services we render to you and expenses we incur in conjunction with the renewal.
- 3.2 Notice of Renewal and Nonrenewal. You must give us written notice of your election to exercise your option to renew at least nine (9) months before the end of the term of this Agreement. Within sixty (60) days of our receipt of your notice, we agree to give you written notice of any deficiencies in your operation or historical performance of the Papa Ray's Pizza Restaurant which could cause us not to renew the Franchise. Our notice will state what actions, if any, you must take to correct the deficiencies in your operation of the Papa Ray's Pizza Restaurant or of the Premises and will specify the time period in which those deficiencies must be corrected. Renewal of the Franchise will be conditioned on your continued compliance with all the terms and conditions of this Agreement up to the date of expiration. If we send a notice of nonrenewal it will state the reasons for our refusal to renew. If we do not give you a deficiency notice within sixty (60) days after receipt of your renewal notice, or if we do not give you notice of our decision not to renew the Franchise six (6) months before the expiration of the term of this Agreement, we may extend the term of this Agreement for any period of time necessary in order to provide you reasonable time to cure the deficiencies or to provide the six (6) month non-renewal notice required under this Agreement.
- 3.3 Renewal Agreement; Releases. To renew the franchise, the Company, you and your Owners must sign the then-current form of standard franchise agreement, which agreement will replace this Agreement in all respects, and which may contain royalty fees, advertising fees and other fees and provisions that differ from those contained in this Agreement; any ancillary agreements we are then customarily using in the grant or renewal of franchises for the operation
of Papa Ray's Pizza Restaurants (with appropriate modifications to reflect the fact that the agreement relates to the grant of a renewal franchise); and a general release, in a form satisfactory to us, of any and all claims against us and our affiliates, and our respective officers, directors, shareholders, employees, and agents. If either you or any of your Owners refuse to sign those agreements and releases within thirty (30) days after their delivery, you will be deemed to have elected not to renew the Franchise.
3.4 Remodeling. As a condition for renewal, you must make reasonable capital expenditures to remodel, upgrade and redecorate the Premises so that your Papa Ray's Pizza Restaurant reflects the then-current image intended to be portrayed by a Papa Ray's Pizza Restaurant, including trade dress, color schemes, lay-out, fixtures, furniture and equipment and presentation of the Marks.
Source: Item 22 — CONTRACTS (FDD pages 39–40)
What This Means (2025 FDD)
According to Aw's 2025 Franchise Disclosure Document, a franchisee has the right to renew their franchise for one additional ten-year term if they have substantially complied with all the provisions of the franchise agreement and any other agreements with Aw. Additionally, the franchisee must maintain possession of the premises. If maintaining possession is not possible, the franchisee must secure an approved substitute premises and agree to develop it according to Aw's specifications and standards for new or renewal franchises.
The franchisee and their owners must also comply with Aw's then-current training requirements and attend any necessary training classes. The franchisee must provide Aw with written notice of their election to renew at least nine months before the end of the current agreement's term. Within 60 days of receiving the renewal notice, Aw will inform the franchisee of any deficiencies in their operation or historical performance that could prevent renewal.
To finalize the renewal, the franchisee, the company, and the owners must sign the then-current form of standard franchise agreement, which may contain different royalty fees, advertising fees, and other provisions. They must also sign any ancillary agreements Aw is using for franchise renewals and a general release of claims against Aw and its affiliates. A renewal fee of $2,500.00 will be charged for services rendered and expenses incurred by Aw in connection with the renewal. Refusal to sign these agreements and releases within 30 days after delivery will be deemed an election not to renew the franchise.
Remodeling of the premises may also be required as a condition of renewal. The franchisee must make reasonable capital expenditures to remodel, upgrade, and redecorate the premises to reflect the current image of an Aw restaurant, including trade dress, color schemes, layout, fixtures, furniture, equipment, and presentation of the marks. All remodeling must be done according to Aw's standards and specifications and with prior written approval.