factual

Does Annex Brands have the right or duty to operate the franchisee's center?

Annex_Brands Franchise · 2025 FDD

Answer from 2025 FDD Document

hat regard:

  • 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.

  • d) Franchisee is solely responsible for establishing and enforcing its own policies related to personnel practices and labor relations. To the extent that Franchisor provides Franchisee with guidelines, recommendations and materials related to personnel practices and labor relations, Franchisee may use those resources, or may choose to use alternate resources. Franchisee is solely responsible for consulting with its own third-party HR service provider and/or legal counsel concerning compliance with applicable personnel and labor relations laws and regulations, and for complying with those laws and regulations.
  • During the term of the Franchise, Franchisee will hold itself out, to the public, public officials, its suppliers, its independent contractors and others, as an independent contractor operating the Center pursuant to rights granted by Franchisor, but not jointly with Franchisor.

Source: Item 22 — Contracts (FDD pages 109–110)

What This Means (2025 FDD)

According to Annex Brands's 2025 Franchise Disclosure Document, Annex Brands generally has no right or duty to operate the franchisee's center. The franchisee is responsible for the day-to-day operations of their center, including training, recruiting, hiring, and managing personnel. Annex Brands may provide training materials and resources, but the franchisee can choose whether to use them. Franchisee's personnel are not Annex Brands's employees, and Annex Brands has no obligation to supervise them. The franchisee is responsible for consulting with HR and legal counsel regarding compliance with personnel laws.

However, the FDD states that if the franchise expires, is terminated, or is not renewed, Annex Brands has the option to enter and operate the former center. This can be done at any time, without prior notice, and forcibly if necessary, at the franchisee's sole risk and expense. Annex Brands assumes no responsibility for damages to the franchisee's property and will not be liable for trespass or other tort or criminal acts. The franchisee may be required to assign any lease interests to Annex Brands and vacate the premises.

This clause gives Annex Brands significant control over the center after the franchise agreement ends. It is important for prospective franchisees to understand the conditions under which Annex Brands can take over the operation and the potential financial and legal implications. Franchisees should seek legal counsel to fully understand their rights and obligations in the event of termination or non-renewal.

Disclaimer: This information is extracted from the 2025 Franchise Disclosure Document and is provided for research purposes only. It does not constitute legal or financial advice. Consult with a franchise attorney before making any investment decisions.