What happens if an Anago Subfranchisor or its personnel are charged with or convicted of a felony?
Anago Franchise · 2025 FDDAnswer from 2025 FDD Document
of Your real or personal property used in the Anago Unit Franchise is sold after levy by any sheriff, marshal or constable.
- (b) You will notify Us within 3 days of the occurrence of any of the events described in Subsection 11.2(a).
- (c) If at any time the Subfranchise Rights Agreement is terminated, this Agreement will also terminate; provided, however, that AFI may in its sole discretion, and upon notice to you, assume Our rights and obligations under this Agreement.
SECTION 11.3 TERMINATION BY US - AFTER NOTICE.
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 c
Source: Item 23 — RECEIPTS (FDD pages 62–298)
What This Means (2025 FDD)
According to Anago's 2025 Franchise Disclosure Document, if an Anago Unit franchisee, or their officer, director, owner, or managerial employee is convicted 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, Anago may terminate all rights granted to the franchisee under the Agreement, without affording the franchisee an opportunity to cure the default, effective immediately upon notice, unless the franchisee immediately and legally terminates the individual as an officer, director, owner, and employee.
This means that a criminal conviction of the franchisee or someone in a key leadership position can lead to immediate termination of the franchise agreement. The only way to avoid termination is to immediately remove the individual in question from their position. This clause protects Anago's brand and reputation by ensuring that individuals associated with the franchise meet a certain standard of conduct.
This type of clause is relatively common in franchise agreements, as franchisors need to protect their brand from negative publicity or actions by franchisees or their employees. Prospective Anago franchisees should be aware of this clause and ensure that they and their key personnel maintain a clean criminal record to avoid potential termination of their franchise agreement.