Can Aw unilaterally terminate the Franchise Agreement if a lease is not signed within the specified timeframe?
Aw Franchise · 2025 FDDAnswer from 2025 FDD Document
nsent to the termination or expiration of this Agreement, or any other relief which we may seek in a complaint to lift the provisions of any automatic stay under any bankruptcy rules. In addition, you (and your Owners) agree not to seek any injunctive relief from any court in any jurisdiction which would have the effect of staying or enjoining this provision.
- 15.2 By the Company With Opportunity to Cure. We have the right to terminate this Agreement upon written notice to you if you (or any of your Owners):
- (a) fail to accurately report the Gross Revenue of your Papa Ray's Pizza Restaurant or to timely pay royalty fees, marketing fund contributions, or other payments due to us or our affiliates, and do not correct such failure within ten (10) days after written notice of such failure is delivered to you;
- (b) commit any act or omission of default under the lease for the Premises and do not cure the default within the applicable cure period set forth in the lease;
Source: Item 22 — CONTRACTS (FDD pages 39–40)
What This Means (2025 FDD)
Based on the 2025 FDD, Aw can terminate the Franchise Agreement under certain conditions if the franchisee fails to comply with the lease terms. Specifically, if the franchisee commits any act or omission of default under the lease for the premises and does not cure the default within the applicable cure period set forth in the lease, Aw has the right to terminate the agreement. This termination is enacted upon written notice to the franchisee, giving them an opportunity to correct the failure within a specified timeframe.
However, the franchisee has an opportunity to cure the default. The franchisee must correct the failure within the cure period outlined in the lease agreement. If the breach cannot be reasonably cured within thirty days, and the franchisee commences a bona fide program to cure the breach within those thirty days, continuing to take necessary actions until completion, a reasonable amount of time will be given to complete the cure. Failure to continue these actions allows Aw to terminate the agreement after written notice.
This condition underscores the importance of carefully negotiating and adhering to the lease agreement for the premises. Franchisees must understand the terms of their lease, including cure periods for defaults, to avoid potential termination of their franchise agreement. It is also important to maintain open communication with Aw regarding any potential lease-related issues to demonstrate a commitment to curing any defaults and maintaining compliance.