What is Annex Brands' policy on replacing leasehold improvements at the Center?
Annex_Brands Franchise · 2025 FDDAnswer from 2025 FDD Document
Franchisee agrees to maintain the condition and appearance of the Center consistent with the System and required uniform image of its franchised businesses as a modern, clean, attractive and efficiently operated Center, which offers high quality products to the public based on friendly, creative and efficient service. Franchisee agrees to perform or cause to be performed at Franchisee's expense whatever maintenance of the Center is required to maintain such condition, appearance, and efficient operation, including: continuous and thorough cleaning; periodic decoration and repair or remodeling, as necessary, of the interior and exterior of the Center; and replacement of worn-out or obsolete leasehold improvements, furnishings, fixtures, equipment, displays, signs, and graphics with approved leasehold improvements, furnishings, fixtures, equipment, displays, signs, and graphics. The Center must have new flooring, and the interior must be repainted to Franchisor's specifications at least once every 60 months. Any tile flooring must be cleaned daily and polished at least semi-annually, and any carpet flooring must be cleaned daily and dry-cleaned at least semi-annually, to Franchisor's specifications as necessary to maintain a clean appearance.
If Franchisee does not maintain the condition and appearance of the Center as is required by this Agreement, Franchisee will give Franchisor access to the Center on not less than 3 days' prior written notice from Franchisor, so that Franchisor may: 1) arrange for the necessary cleaning, repair, remodeling, upgrading, painting or decorating; and 2) replace the necessary leasehold improvements, furnishings, fixtures, equipment, displays, signs, or graphics. Franchisee must pay the entire cost thereof within 10 days of receipt of an invoice from Franchisor for the services or purchases.
Source: Item 22 — Contracts (FDD pages 109–110)
What This Means (2025 FDD)
According to Annex Brands' 2025 Franchise Disclosure Document, franchisees must maintain the condition and appearance of their Center to align with the brand's image. This includes replacing worn-out or obsolete leasehold improvements, furnishings, fixtures, equipment, displays, signs, and graphics with approved items. The Center's flooring must be new, and the interior must be repainted to Annex Brands' specifications at least once every 60 months. Tile flooring must undergo daily cleaning and semi-annual polishing, while carpet flooring requires daily cleaning and semi-annual dry-cleaning.
Annex Brands retains significant control over these replacements and alterations. Franchisees cannot make any material alterations to the Center without prior written consent from Annex Brands. All replacements must be with items approved by Annex Brands. If a franchisee fails to maintain the Center's condition as required, Annex Brands has the right to access the Center, arrange for the necessary work, and replace items as needed. The franchisee is then responsible for covering all associated costs within 10 days of receiving an invoice from Annex Brands.
This policy ensures brand consistency across all Annex Brands locations, but it also places a financial burden on the franchisee. The franchisee is responsible for the costs of maintaining and updating the Center, and must adhere to Annex Brands' standards and obtain approval for any changes. This could potentially limit the franchisee's autonomy in making decisions about their Center's appearance and functionality. Prospective franchisees should carefully consider these requirements and budget accordingly to avoid potential conflicts or financial strain.