After the Anago subfranchise agreement terminates, for how long is the Subfranchisor restricted from engaging in a Competitive Business?
Anago Franchise · 2025 FDDAnswer from 2025 FDD Document
- (a) In-Term. Subfranchisor agrees that during the Term (including any successor terms) except as otherwise approved in writing by Franchisor, Subfranchisor will not, either directly or indirectly, for itself, or through, on behalf of, or in conjunction with any person, persons, partnership, limited liability company, corporation, or relative:
- (i) directly or indirectly, solicit or otherwise attempt to induce, by combining or conspiring with, or attempting to do so, or in any other manner influence any Business Affiliate of the Franchisor to terminate or modify his, her or its position with to compete against the Franchisor;
Source: Item 23 — RECEIPTS (FDD pages 62–298)
What This Means (2025 FDD)
The 2025 Anago Franchise Disclosure Document outlines restrictions on Subfranchisors both during the term of the agreement and after its termination. Specifically, during the term of the agreement, the Subfranchisor is prohibited from soliciting or attempting to induce any Business Affiliate of Anago to terminate or modify their position in order to compete against Anago, unless approved in writing by Anago.
However, the excerpt does not specify the duration of the restriction on engaging in a Competitive Business after the Anago Subfranchise Rights Agreement terminates. The document does state that after termination, the Subfranchisor must cease operations, discontinue using Anago's proprietary marks and confidential information, and assign client accounts to Anago.
To fully understand the restrictions that apply after the termination of the Anago subfranchise agreement, a prospective franchisee should consult the complete FDD and ask Anago for clarification on the duration and scope of the non-compete clause. This information is crucial for evaluating the long-term implications of investing in an Anago franchise.