Under the Anago Subfranchise Agreement, what happens if the Subfranchisor defaults on any other agreement with the Franchisor or its Affiliates?
Anago Franchise · 2025 FDDAnswer from 2025 FDD Document
If Subfranchisor commits a default in the performance of any of the covenants, conditions or agreements contained in any other agreement between Subfranchisor and Franchisor or its Affiliates, Subfranchisor shall also have breached this Agreement and Franchisor shall have all of the remedies available to it under this Agreement, including, but not limited to, the right to terminate this Agreement pursuant to Section 8.2, in addition to Franchisor's rights, if any, under such other agreement(s).
Source: Item 23 — RECEIPTS (FDD pages 62–298)
What This Means (2025 FDD)
According to Anago's 2025 Franchise Disclosure Document, a Subfranchisor's default in any agreement with Anago or its Affiliates constitutes a breach of the Anago Subfranchise Rights Agreement. In such a case, Anago has all available remedies under the Subfranchise Agreement.
These remedies include the right to terminate the Subfranchise Agreement, in addition to any rights Anago might have under the separate agreement that was breached. This "cross-default" provision means that a failure to uphold obligations in one agreement can trigger consequences in another, giving Anago broad protection.
This clause is significant for prospective Anago subfranchisees as it highlights the interconnectedness of all agreements with Anago and its Affiliates. A default, even on a seemingly minor agreement, can have serious repercussions on the Subfranchise Agreement, potentially leading to termination. Subfranchisees should carefully review all agreements and ensure they can meet all obligations to avoid triggering this cross-default provision.