When is the late fee charged to Annex Brands franchisees?
Annex_Brands Franchise · 2025 FDDAnswer from 2025 FDD Document
| Type of Fee (14) | Amount | Due Date | Remarks |
|---|---|---|---|
| Audit (14) | Cost of audit ($500 minimum) plus 1.5% per month interest or the highest rate allowed by law on underpayment. In addition, you must pay us a late fee of $35 per week. | 10 days after invoice | Payable to us if an inspection or audit is made necessary due to your failure to furnish reports, records, or other information to us on a timely basis, or if audit shows that you have understated any amount owed to us by more than 5% for any accounting period or if we discover a history of similar under reporting offenses. You must pay us by automatic bank draft. (3) |
Source: Item 6 — OTHER FEES (FDD pages 24–32)
What This Means (2025 FDD)
According to Annex Brands' 2025 Franchise Disclosure Document, a late fee is charged to franchisees under specific circumstances related to audits. If an inspection or audit is necessary because a franchisee fails to provide reports, records, or other information on time, or if the audit reveals that the franchisee has understated any amount owed to Annex Brands by more than 5% for any accounting period, or if there is a history of similar underreporting offenses, a late fee will be applied.
The amount of the late fee is $35 per week. In addition to the late fee, the franchisee is responsible for the cost of the audit, with a minimum of $500, plus interest at a rate of 1.5% per month, or the highest rate allowed by law, on the underpayment. The payment is due to Annex Brands 10 days after the invoice date, and franchisees are required to pay via automatic bank draft.
This policy encourages franchisees to maintain accurate records and submit them promptly. The late fee and interest serve as penalties for non-compliance and underreporting, ensuring that Annex Brands receives accurate financial information and timely payments. Franchisees should ensure they understand the reporting requirements and maintain meticulous records to avoid these charges.