Under what conditions can Anago delegate its duties under the Subfranchisor Agreement?
Anago Franchise · 2025 FDDAnswer from 2025 FDD Document
WHEREAS, as a condition to AFI entering into the Subfranchise Agreement, AFI has required that Subfranchisor, and Subfranchisor has agreed to, assign its right, title and interest in the Client Accounts to AFI, with the right to reassign to an authorized Anago subfranchisor, as security for Subfranchisor's obligations and AFI's rights under the Subfranc
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- Upon the occurrence of the events set forth in paragraph 2 above, AFI shall have the right to assign ALL Client Accounts to an approved Anago subfranchisor, as designated by AFI.
Source: Item 23 — RECEIPTS (FDD pages 62–298)
What This Means (2025 FDD)
According to Anago's 2025 Franchise Disclosure Document, Anago Franchising, Inc. (AFI) has the right to reassign a Subfranchisor's Client Accounts to another approved Anago subfranchisor under specific conditions. This reassignment can occur if the Subfranchisor defaults under the Subfranchise Agreement or upon the termination or expiration of the Subfranchise Agreement.
Upon the occurrence of a default, termination, or expiration, AFI has the option to assume the Client Accounts, effectively stepping into the shoes of the Subfranchisor. If AFI exercises this option, it is then deemed to have assumed all the responsibilities and obligations of the Subfranchisor related to those Client Accounts and is entitled to all associated rights and privileges. Following this, AFI can then assign these Client Accounts to another Anago subfranchisor that it approves.
However, if AFI does not exercise its option to take over the Client Accounts, it is not liable for any services, duties, or obligations related to them. In this case, the original Subfranchisor remains responsible for fulfilling all services, duties, and obligations associated with the Client Accounts. This ensures continuity of service to clients while allowing Anago to manage its network of subfranchisees effectively.