Is there any exception to the termination of the Anago franchise agreement if the Subfranchise Rights Agreement is terminated?

According to Anago's 2025 Franchise Disclosure Document, the Anago Subfranchise Rights Agreement will also terminate if the Subfranchise Rights Agreement is terminated. However, there is an exception: AFI (presumably Anago Franchising, Inc., though this is not explicitly defined in the provided excerpts) has the option, at its sole discretion and with notice to the subfranchisor, to assume the rights and obligations under the agreement.

This means that if the Subfranchise Rights Agreement is terminated, the Anago subfranchise agreement will also end unless AFI decides to step in and take over the agreement. This decision is entirely up to AFI, and they must provide notice to the subfranchisor if they choose to do so.

For a prospective Anago subfranchisee, this clause presents both a risk and a potential benefit. The risk is that termination of the Subfranchise Rights Agreement automatically leads to the termination of the subfranchise agreement, potentially disrupting their business. The benefit is that AFI has the option to assume the agreement, which could provide a safety net and ensure business continuity in certain circumstances. A prospective franchisee should seek clarification from Anago regarding the conditions under which AFI would exercise this option.