Did Annex Brands or its affiliates initiate any litigation in their last fiscal year?

According to the 2025 FDD, Annex Brands states that neither they nor their affiliates initiated any litigation during their last fiscal year. Item 3 of the FDD addresses litigation, and specifically states that no actions were initiated by Annex Brands or its affiliates in the last fiscal year.

However, the FDD does disclose a pending action against Annex Brands. Siew May Seow, an Annex Brands franchisee, filed an action in San Diego Superior Court on June 30, 2023, alleging claims for breach of contract, breach of the implied covenant of good faith and fair dealing, false promise, and restitution. The franchisee is seeking a refund of the $29,950 initial franchise fee, punitive damages, attorney fees and costs, and prejudgment interest. Annex Brands filed a motion to compel arbitration, which was granted, and the case was stayed. An arbitration hearing was scheduled for March 19, 2025. Annex Brands denies the franchisee's claims and intends to defend against them.

It is important for a potential franchisee to carefully review Item 3 to understand the nature and status of any pending or concluded litigation involving Annex Brands. While the absence of litigation initiated by Annex Brands may be seen as a positive sign, the existence of franchisee-initiated lawsuits could indicate potential areas of concern regarding franchisee relations or business practices.