What right does Anago grant to the franchisee under the Unit Franchise Agreement?

eement.

• E. You understand that ACS and AFI are not parties to this Agreement and have no obligation to You.
• F. All defined terms having the meaning given to them in Section 17.1 or when first used.

The parties agree as follows:

ARTICLE 1 - APPOINTMENT

SECTION 1.1 GRANT OF UNIT FRANCHISE.

We grant You the right, and You undertake the obligation, to operate 1 Anago Unit Franchise under the System, subject to the terms of this Agreement.

SECTION 1.2 NO PROTECTED TERRITORY.

You are not obtaining any exclusive or protected territory. You may only operate your Unit Franchise anywhere within the counties of (Your counties) in the state of (Your State) (the "Area") under the name Anago. You cannot operate your Unit Franchise outside the Area. We may open and operate Company Units and franchise the Anago Unit Franchise to other Unit Franchisees or engage in any other method of distribution in Our complete discretion whenever, however and wherever We determine, including within the Area. You must designate your own Premises within the Area from which you will manage and administer Your Unit Franchise. If You do not operate Your Anago Unit Franchise out of Your residence but instead occupy a business premises, such business premises and lease agreement will be subject to our prior written approval, which will not be unreasonably withheld.

SECTION 1.3 NATURE OF RELATIONSHIP.

The parties expressly agree that this Agreement is an independent contractor relationship. Nothing in this Agreement shall be deemed to constitute or otherwise create an employment, partnership, joint venture or other formal business entity of any kind and the rights and obligations of the parties shall be as expressly set forth herein.

Source: Item 23 — RECEIPTS (FDD pages 62–298)