What is prohibited regarding the collateral for an Anago franchise without prior written consent?

According to Anago's 2025 Franchise Disclosure Document, franchisees are restricted from encumbering rights or obligations under the franchise agreement without Anago's prior written consent. Specifically, Section (f) of Item 23 states that if a franchisee attempts to encumber or transfer any rights or obligations under the agreement, including any interest in the franchise, without Anago's written consent, it constitutes an event of default. This means Anago could terminate the agreement if a franchisee violates this provision.

This restriction is in place to ensure that Anago maintains control over who is involved in the franchise system and how the franchise operates. By requiring consent for any encumbrance or transfer, Anago can vet potential new parties and ensure they meet the brand's standards and qualifications. This protects the integrity of the Anago brand and the interests of other franchisees in the system.

For a prospective Anago franchisee, this means they cannot use their franchise agreement or any rights associated with it as collateral for a loan or other financial obligation without first obtaining written permission from Anago. Failure to do so could result in the termination of their franchise agreement. It is important to understand these restrictions and seek approval from Anago before taking any action that could be considered an encumbrance or transfer of rights.