Are the initial franchise fee and conversion training fee for Annex Brands refundable?
Annex_Brands Franchise · 2025 FDDAnswer from 2025 FDD Document
8. FEES
- A. INITIAL FRANCHISE FEE; CONVERSION TRAINING FEE. The initial franchise fee and any applicable conversion training fee are due and payable when this Agreement is executed and are non-refundable except as described below:
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- Initial Franchise Fee for a Standard Center or Flex Center. If this Agreement is for a standard Center or flex Center, Franchisee will pay to Franchisor an initial franchise fee of:
- a) $35,000; or
- b) $26,250 if Franchisee qualifies for the VetFran discount; provided that the Center must be operational within 365 days after this Agreement is signed, and must be owned and operated by Franchisee for a minimum of 1 year thereafter; and provided further that if the Center is sold before the completion of 1 year of operation, Franchisee must pay to Franchisor the discounted amount of the initial franchise fee ($8,750) upon sale of the Center; or
- c) $17,500 if this Agreement is for a Center that will be converted from a qualifying existing business providing the same services to the public; provided, however, that Franchisee will also pay to Franchisor a conversion training fee of $4,000; and provided further that the Center must be operational within 365 days after this Agreement is signed and must be owned and operated by Franchisee for a minimum of 1 year thereafter; and provided further that if the Center is sold before the completion of 1 year of operation, Franchisee must pay to Franchisor the discounted amount of the initial franchise fee ($17,500) upon sale of the Center; or
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- d) $13,125 if this Agreement is for a Center that will be converted from a qualifying existing business providing the same services to the public and the Franchisee qualifies for the VetFran discount; provided, however, that Franchisee will also pay to Franchisor a conversion training fee of $4,000; and provided further that the Center must be operational within 365 days after this Agreement is signed and must be owned and operated by Franchisee for a minimum of 1 year thereafter; and provided further that if the Center is sold before the completion of 1 year of operation, Franchisee must pay to Franchisor the discounted amount of the initial franchise fee ($21,875) upon sale of the Center; or
- e) $17,500 if Franchisee already owns and operates at least 1 Center or 1 Commercial Logistics Center; provided that the Center must be operational within 365 days after this Agreement is signed, and must be owned and operated by Franchisee for a minimum of 1 year thereafter; and provided further that if the Center is sold before the completion of 1 year of operation, Franchisee must pay to Franchisor the discounted amount of the initial franchise fee ($17,500) upon sale of the Center; or
- f) $13,125 if Franchisee already owns and operates at least 1 Center or 1 Commercial Logistics Center; and the Franchisee qualifies for the VetFran discount provided that the Center must be operational within 365 days after this Agreement is signed, and must be owned and operated by Franchisee for a minimum of 1 year thereafter; and provided further that if the Center is sold before the completion of 1 year of operation, Franchisee must pay to Franchisor the discounted amount of the initial franchise fee ($21,875) upon sale of the Center;
Source: Item 22 — Contracts (FDD pages 109–110)
What This Means (2025 FDD)
According to Annex Brands's 2025 Franchise Disclosure Document, the initial franchise fee and conversion training fee are generally non-refundable, but there are specific circumstances where a refund may be possible. The initial franchise fee and any applicable conversion training fee are due when the Franchise Agreement is executed.
If Annex Brands terminates the Franchise Agreement before the franchisee begins initial training, Annex Brands may refund the initial franchise fee, but will deduct $10,000 to cover services already provided, as well as any out-of-pocket expenses, including broker referral fees. However, if Annex Brands terminates the agreement after the franchisee begins initial training, no portion of the initial franchise fee will be refunded. If a franchisee decides to purchase an existing center instead of opening a new center after signing the franchise agreement, Annex Brands will not refund any of the initial franchise fee, regardless of whether Annex Brands terminates the franchise.
For franchisees in North Dakota, the FDD includes a rider modifying the refund conditions. Any release required to be signed in connection with a refund of the initial franchise fee will not apply to claims arising under the North Dakota Franchise Investment Law.
It is important for prospective Annex Brands franchisees to understand these conditions and consider them carefully before signing the Franchise Agreement and paying the initial franchise fee. Franchisees should clarify any questions or concerns about the refund policy with Annex Brands before proceeding.