Does Annex Brands have any restrictions on its right to assign the franchise agreement?
Annex_Brands Franchise · 2025 FDDAnswer from 2025 FDD Document
| Provision | Franchise | Summary |
|---|---|---|
| Agreement | ||
| (h) "Cause" defined- non-curable defaults | 3.A, 14.D and 15.A | On notice: You fail to open your franchise within 365 days after signing the franchise agreement; you do not locate an acceptable site within 365 days after signing the franchise agreement (3.A); you fail to give notice of non-renewal or to satisfy renewal conditions (14.D); you intentionally make material misrepresentations or omissions in your application for the franchise; you are convicted or plead no contest to a felony or crime that may adversely affect your reputation or your franchise's reputation; you make unauthorized use or disclosure of our confidential information; you surrender or transfer control of your franchise in violation of the franchise agreement; you underreport Gross Receipts by 5% at least 3 times; you make unauthorized use of any Mark; your lease or sub-lease is terminated; you fail to complete initial training; or you receive 3 notices of default in a 12-month period (15.A). |
| (i) Your obligations after transfer, expiration, termination or non renewal | 16 and Attachment 11 | After transfer (as applicable), expiration, termination or non-renewal: you must pay sums owed us within 10 days; cease using our Marks; remove signs and other materials with our Marks; de-identify; alter appearance of franchised business, comply with post-term non competition and non-interference covenants; transfer to us all telephone and fax numbers, classified or other telephone and fax directory listings, email addresses, domain names, email marketing programs, social media platforms, online directory listings, other networking platform listings, or other comparable electronic identities, that are associated with our Marks or related to your retail center; cancel fictitious name registrations; return our Manuals; cease use of our confidential information; on our request, furnish to us a copy of center's sales history and customer database for the most recent 2-year period (or shorter if applicable); permit us to enter, operate and attempt to sell your retail center, if we elect. If you do not comply, you also must pay our expenses in enforcing our rights. |
| (j) | 13.A | There is no restriction on our right to assign. |
| Assignment of agreement by us |
Source: Item 17 — Renewal, Termination, Transfer, and Dispute Resolution (FDD pages 71–74)
What This Means (2025 FDD)
According to Annex Brands's 2025 Franchise Disclosure Document, there are no restrictions on Annex Brands's right to assign the franchise agreement. This means Annex Brands can transfer its rights and obligations under the franchise agreement to another party without needing the franchisee's consent or meeting specific conditions.
For a prospective franchisee, this signifies that the entity they initially contracted with may change during the term of the agreement. The new entity would then assume the responsibilities and rights of the franchisor. While this is permitted, the new franchisee would still be bound to the terms of the original franchise agreement unless an amendment is agreed upon.
In the franchise industry, it is not uncommon for franchisors to retain the right to assign agreements to affiliates, parent companies, or in the event of a merger or acquisition. This flexibility allows the franchisor to adapt to changing business conditions. However, franchisees should be aware of this provision and consider the potential implications of dealing with a different franchisor entity during the course of their franchise agreement with Annex Brands.