Does Annex Brands have any liability for damages arising out of the operation of the Center?
Annex_Brands Franchise · 2025 FDDAnswer from 2025 FDD Document
a) Franchisor has no right or duty to operate the Center, and disclaims any liability under this Agreement for any damages arising out of the operation of the Center.
b) Except as provided in this Agreement, Franchisee is solely responsible for training its personnel.
To the extent that Franchisor provides Franchisee with materials and other resources related to training Franchisee's management and non-management personnel on matters in the interest of protecting and maintaining the goodwill of the System and the Marks, and not in order to give Franchisor control the day-to-day operation of the Center, Franchisee must use those training resources as Franchisor directs.
To the extent that Franchisor provides Franchisee with guidelines, recommendations, materials and other resources related to training Franchisee's management and non-management personnel on other matters, Franchisee may use those training resources, or may choose to use alternate training resources, so long as its management and non-management personnel are trained to operate the Center in a System-compliant, legal and safe manner.
- c) Franchisee is solely responsible for recruiting, interviewing, hiring, determining the terms of employment of, compensating, keeping the time of, processing the payroll of, providing work resources to, scheduling, supervising, disciplining and firing Franchisee's personnel.
Franchisee's personnel are not Franchisor's employees, independent contractors or agents.
Franchisor has no right or duty to supervise, or to exercise control over, Franchisee's personnel in the operation of the Center, and disclaims any rights or responsibilities as to Franchisee's personnel.
To the extent that Franchisor provides Franchisee with guidelines, recommendations, materials and other resources related to functions such as recruiting, interviewing, hiring, determining the terms of employment of, compensating, keeping the time of, processing the payroll of, providing work resources to, scheduling, supervising, disciplining or firing personnel, Franchisee may use those resources, or may choose to use alternate resources.
Franchisee is solely responsible for consulting with its own third-party human resources ("HR") service provider and/or legal counsel concerning compliance with all applicable personnel laws and regulations, and for complying with those laws and regulations.
Source: Item 22 — Contracts (FDD pages 109–110)
What This Means (2025 FDD)
According to Annex Brands's 2025 Franchise Disclosure Document, Annex Brands disclaims liability for damages arising from the operation of the franchised Center. The Franchise Agreement specifies that Annex Brands has no duty to operate the Center and explicitly disclaims any liability for damages that may occur due to its operation. This means that as a franchisee, you are responsible for all aspects of running the business, including any potential liabilities.
Furthermore, the agreement stipulates that the franchisee must indemnify and hold Annex Brands harmless against any liability for claims arising from the construction or operation of the Center. This indemnification extends to all liabilities, obligations, actual and consequential damages, taxes, and costs reasonably incurred in defending any claim, including accounting, expert, and legal fees. This obligation remains in effect even after any transfer, expiration, termination, or nonrenewal of the franchise agreement.
The Franchise Agreement emphasizes that Annex Brands does not exercise direct or indirect control over the day-to-day operations of the Center, including safety, security, equipment use, service delivery, and personnel management. Consequently, all liability arising from the Center's operation falls solely on the franchisee. This includes any claims related to employment or agency issues. Therefore, franchisees should ensure they have adequate insurance coverage and legal counsel to manage these potential risks.