What constitutes a default by an Anago franchisee under the security agreement?
Anago Franchise · 2025 FDDAnswer from 2025 FDD Document
If You are in default We may, at Our option, terminate all rights granted to You under this Agreement, without affording You an opportunity to cure the default, effective immediately upon notice to You, upon the occurrence of any of the following Events of Default:
- (a) If You cease to perform contracted service to the Accounts for more than 3 consecutive days without Our consent;
- (b) If You fail or refuse to comply with any mandatory specification, standard or operating procedure We require in this Agreement, in the Manual or otherwise in writing, on the cleanliness or sanitation of the Anago Unit Franchise;
- (c) If You, or Your officer, director, owner or managerial employee is convicted of a felony, a crime of moral turpitude or any other crime or offense that We reasonably believe is likely to have a material adverse effect on the System, the Proprietary Property, the goodwill associated with the Proprietary Property, or Our interest in any of the Proprietary Property, unless You immediately and legally terminate the individual as an officer, director, owner and employee;
- (d) If You deny Us the right to inspect the Anago Unit Franchise or to audit the Records of the Anago Unit Franchise;
- (e) If You engage in conduct that is harmful to or reflects unfavorably on You or the System in that the conduct exhibits a reckless disregard for the physical or mental well-being of employees, Clients, Our representatives or the public at large, including battery, assault, sexual harassment or discrimination, racial harassment or discrimination, alcohol or drug abuse or other forms of threatening, outrageous or unacceptable behavior as determined in Our sole discretion;
- (f) If You, contrary to this Agreement, purport to encumber or transfer any rights or obligations under this Agreement (including transfers of any interest in You), without Our written consent;
- (g) If any breach occurs under Sections 6.2 or 13.1 concerning confidentiality and noncompetition covenants;
- (h) If You knowingly maintain false Records, or knowingly submit any false Records to Us;
- (i) If Yo
Source: Item 23 — RECEIPTS (FDD pages 62–298)
What This Means (2025 FDD)
According to Anago's 2025 Franchise Disclosure Document, a franchisee may be considered in default under the agreement under various circumstances. Anago can terminate all rights granted to the franchisee without providing an opportunity to cure the default, effective immediately upon notice.
Events of default include ceasing to perform contracted services to accounts for more than three consecutive days without Anago's consent. Default events also include failing or refusing to comply with any mandatory specification, standard, or operating procedure required in the Agreement, the Manual, or otherwise in writing, regarding the cleanliness or sanitation of the Anago Unit Franchise.
Further events that trigger default include conviction of the franchisee, or their officer, director, owner, or managerial employee, of a felony, a crime of moral turpitude, or any other crime or offense that Anago reasonably believes is likely to have a material adverse effect on the System, the Proprietary Property, the goodwill associated with the Proprietary Property, or Anago's interest in any of the Proprietary Property, unless the individual is immediately and legally terminated. Other events of default are denying Anago the right to inspect the Anago Unit Franchise or to audit the Records of the Anago Unit Franchise, engaging in conduct that is harmful to or reflects unfavorably on the franchisee or the System, purporting to encumber or transfer any rights or obligations under the Agreement without Anago's written consent, any breach under Sections 6.2 or 13.1 concerning confidentiality and noncompetition covenants, and knowingly maintaining false Records, or knowingly submitting any false Records to Anago.