Does Anago have any restrictions on its right to assign its interest in the Anago Subfranchise Rights Agreement?
Anago Franchise · 2025 FDDAnswer from 2025 FDD Document
| i. Franchisee's obligations on termination / non renewal | ARTICLE 9, Subsection 10.2(b) and Section 11.2 | You must: 1. Comply with the restrictions on competition (see row "r" below); 2. Indemnify us from any losses or damages we sustain as a result of your operation of the Anago Subfranchise Rights Business; 3. Discontinue all use of, and maintain confidentiality of, all our Confidential Information; 4. Cease operating your Anago Subfranchise business; 5. Pay all amounts you owe to us within 10 days; 6. Discontinue use of Proprietary Marks and de-identify your Subfranchise Rights Business; 7. Cease use of the Subfranchise Rights Business' telephone numbers, websites, social media accounts, etc. and transfer such telephone numbers, websites, and social media accounts to us or such other party as we may designate; 8. Assign all Unit Franchises and Unit Franchise Agreements to us; 9. Assign all Clients and Client Accounts to us; 10. Return all Proprietary Property to us; 11. Cease selling Unit Franchises; cease providing services to Unit Franchises; and cease solicitation of Clients; and 12. Cancel assumed, fictitious and trade name registrations. |
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| j. Assignment of contract by franchisor | Section 7.1 | There are no restrictions on our right to assign our interest in your Subfranchise Rights Agreement. |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 44–52)
What This Means (2025 FDD)
According to Anago's 2025 Franchise Disclosure Document, Anago has no restrictions on its right to assign its interest in the Subfranchise Rights Agreement. This means Anago can transfer its rights and obligations under the agreement to another party without needing the subfranchisee's consent or meeting specific conditions.
For a prospective Anago subfranchisee, this clause provides clarity that Anago retains the freedom to sell, transfer, or assign the subfranchise agreement to a third party. While this provides flexibility for Anago, it also introduces an element of uncertainty for the subfranchisee, as they may find themselves dealing with a new franchisor during the term of their agreement.
It is important for a potential subfranchisee to consider the implications of this clause and to evaluate Anago's history and reputation regarding assignments. Understanding the circumstances under which Anago might assign the agreement, and the potential impact on the subfranchisee's business, is a crucial part of the due diligence process.