After the termination of the Anago subfranchise agreement, is a Subfranchisor allowed to interfere with the business of Anago or its other Subfranchisors and Unit Franchisees?
Anago Franchise · 2025 FDDAnswer from 2025 FDD Document
ng the Term, and copies of any other documents that Subfranchisor is required to retain for compliance with any applicable law. Subfranchisor agrees it shall be solely responsible for all expenses associated with the copying of the materials.
Section 9.4 - Cessation of Operation
- (a) Subfranchisor will immediately cease operation of the Subfranchise Business and shall not directly or indirectly, at any time or in any manner identify itself or any business as a current or former Anago Subfranchise, franchisee, licensee or dealer of, or otherwise associated with, Franchisor or the System. Without limiting the generality of the foregoing, Subfranchisor shall immediately: (i) cease selling Unit Franchises for the Franchisor; (ii) cease using all advertising materials, forms and other materials bearing the Proprietary Marks; (iii) cease holding itself out as a Subfranchisor of Franchisor; (iv) take all steps necessary to disassociate itself from Franchisor and the System; (v) cease solicitations of Clients; (vi) cease all communication with all Clients; (vii) cease providing services to Unit Franchisees; and (viii) promptly and at its own expense make the alterations Franchisor may specify in the Anago Manuals (or otherwise) to distinguish the Premises clearly from its former appearance in order to prevent public confusion. Franchisor is free to sell new Unit Franchises, enter into new Subfranchise rights agreements or other arrangements in the Area without any obligation to the Subfranchisor. Subfranchisor shall immediately assign all Client Accounts to Franchisor in accordance with Section 9.5 below.
- (b) Subfranchisor shall furnish to Franchisor within thirty (30) days after the effective date of the termination or expiration of this Agreement, evidence satisfactory to Franchisor of Subfranchisor's compliance with the foregoing obligations.
Source: Item 23 — RECEIPTS (FDD pages 62–298)
What This Means (2025 FDD)
According to Anago's 2025 Franchise Disclosure Document, after the termination of the Subfranchise Agreement, the Subfranchisor must immediately cease operation of the Subfranchise Business and is restricted from identifying themselves or any business as a current or former Anago Subfranchise. They must also cease selling Unit Franchises for Anago and discontinue using all advertising materials, forms, and other materials bearing Anago's Proprietary Marks.
To further disassociate from Anago, the Subfranchisor must stop holding themselves out as a Subfranchisor of Anago, cease solicitations of Clients, and cease all communication with all Clients. They are also required to stop providing services to Unit Franchisees. The Subfranchisor must also make alterations to distinguish the Premises clearly from its former appearance in order to prevent public confusion. Anago is then free to sell new Unit Franchises or enter into new Subfranchise rights agreements in the Area without any obligation to the Subfranchisor.
In addition, all current and future principals, employees, and agents of the Subfranchisor involved with the Subfranchise Business and having access to the Anago Manuals or any other Confidential Information, are required to sign a nondisclosure and noninterference agreement before Initial Subfranchisor Training or upon employment.