What triggers Anago to assess Billing and Collection Fees indefinitely?
Anago Franchise · 2025 FDDAnswer from 2025 FDD Document
| Type of Fee1 | Amount | Due Date2 | Remarks |
|---|---|---|---|
| Billing and Collection Fees | An invoice servicing fee of the greater of $1,000 or 1% of your Gross Revenues and $25 for each unit franchise statement (Waived for first 12 months. See Remarks.). | Monthly on the 20th day of each month | Under the Unit Franchise Agreement, your Unit Franchise will appoint you as its billing and collections agent. For 12 months after you begin operating and indefinitely after an event of default, you will delegate that responsibility to us. We provide this service at no charge during the initial 12-month period (except for the cost of postage). If we provide the service after an event of default or, at your request, beyond the initial 12-month period, this fee will be assessed by us. |
Source: Item 6 — OTHER FEES (FDD pages 12–19)
What This Means (2025 FDD)
According to Anago's 2025 Franchise Disclosure Document, Billing and Collection Fees can be assessed indefinitely after an event of default. Initially, Anago waives this fee for the first 12 months of operation, but after this period, the fee applies if Anago provides the service at the subfranchisee's request or due to an event of default.
The Billing and Collection Fees are structured as the greater of $1,000 or 1% of the subfranchisee's Gross Revenues, plus $25 for each unit franchise statement. This fee covers Anago's services as the billing and collections agent for the unit franchisees, a role that the subfranchisee typically holds under the Unit Franchise Agreement.
For a prospective Anago subfranchisee, this means that maintaining compliance and avoiding default is crucial to avoid incurring these ongoing fees after the initial 12-month grace period. The fees can significantly impact profitability, especially for subfranchisees with high gross revenues or numerous unit franchisees. It is important to understand what constitutes an 'event of default' under the Subfranchise Rights Agreement to proactively manage and mitigate the risk of these fees being imposed.