If Anago delegates duties to a Designee, what obligations does the Subfranchisor have to the Designee?
Anago Franchise · 2025 FDDAnswer from 2025 FDD Document
(f) Subfranchisor shall not, itself, or through or in association with any third party, directly or indirectly, collect any money (other than in accordance with this Agreement), or barter or trade for anything of value, from a prospect, Unit Franchisee or any third party, directly or indirectly (including, but not limited to, consideration of any kind furnished by a third party to Subfranchisor or its designee, based upon or resulting from payment by a prospective franchisee or Unit Franchisee to such third party) which is in any way related to: (i) services to be provided by Subfranchisor pursuant to this Agreement; or (ii) the establishment and/or operation of a Unit pursuant to a Unit Franchise Agreement. Additionally, without limiting the generality of the foregoing, Subfranchisor shall not accept or otherwise receive payment including discounts, products, rebates or the like from any existing or prospective franchisee, landlord, vendor, broker, agent or supplier of the System or any representative or agent thereof, in connection with its operations hereunder or in any way related to the System or its Unit Franchisees.
Source: Item 23 — RECEIPTS (FDD pages 62–298)
What This Means (2025 FDD)
Based on the 2025 Anago Franchise Disclosure Document, the Subfranchisor is prohibited from directly or indirectly collecting money or trading anything of value from a prospect, Unit Franchisee, or any third party through a designee. This restriction applies to anything related to services provided by the Subfranchisor or the establishment and operation of a unit. The Subfranchisor also cannot accept payments, discounts, products, or rebates from any existing or prospective franchisee, landlord, vendor, broker, agent, or supplier of the Anago system through a designee.
This means that if Anago allows a Subfranchisor to use a designee for certain tasks, the Subfranchisor remains responsible for ensuring that the designee does not engage in any unauthorized financial transactions or accept any prohibited benefits related to the Anago franchise system. The Subfranchisor must monitor the designee's activities to prevent any actions that could violate the franchise agreement.
This provision protects Anago's financial interests and ensures fair and transparent dealings within the franchise network. It prevents Subfranchisors from using designees to circumvent the financial rules and maintain consistent financial practices across all franchise operations. A prospective franchisee should clarify with Anago what specific monitoring and compliance measures are expected regarding the actions of any designees.