What are the circumstances under which Annex Brands may require franchisees to license updates and enhancements for the PostalMate POS network software, as described in Item 8?

According to Annex Brands' 2025 Franchise Disclosure Document, Annex Brands is the only approved supplier of the PostalMate POS network software and all related updates and enhancements that franchisees must use for their retail centers. Annex Brands may require franchisees to license, either through them or third-party suppliers, updates and enhancements for an additional charge. This is contingent upon Annex Brands considering that these updates and enhancements will significantly improve the operation or function of the PostalMate POS network software.

This means that as a franchisee, you are obligated to use the PostalMate POS software provided by Annex Brands and any updates they deem necessary. The cost for these updates is separate from the initial franchise fee and ongoing royalties. It's important to note that Annex Brands retains the discretion to determine what constitutes a significant improvement to the software's operation or function, which could lead to mandatory expenses for franchisees.

Prospective franchisees should consider this when budgeting for ongoing operational costs. It would be prudent to inquire about the historical frequency and cost of such updates, as well as the criteria Annex Brands uses to determine the necessity of these enhancements. Understanding these factors can help in forecasting potential expenses related to software maintenance and upgrades during the franchise term.