Does Annex Brands have the right to terminate the franchise without cause?
Annex_Brands Franchise · 2025 FDDAnswer from 2025 FDD Document
| Provision | Section in Franchise Agreement | Summary | |
|---|---|---|---|
| (a) | Length of the franchise term | 2.A | 20 years. |
| (b) | Renewal or extension of the term | 14.A | An additional 20-year term. |
| (c) | Requirements for you to renew or extend | 14.A to C | Substantially comply with franchise agreement and all other agreements with us or our affiliates; notify us of intent to renew 6-12 months before 20-year anniversary of execution of franchise agreement; show evidence of right to possess site, or secure approved substitute site; fully comply with specifications and standards for franchised businesses; sign general release; sign then current franchise agreement and related agreements; pay renewal fee. At the expiration of the term, if you seek to renew your franchise, you may be asked to sign a new franchise agreement that contains terms and conditions materially different from those in your previous franchise agreement, such as different fee requirements and territorial rights. |
| (d) | Termination by you | Not applicable | Subject to state law. |
| (e) | Termination by us without cause | Not applicable | We cannot terminate your franchise without cause. |
| (f) | Termination by us with cause | 3.A, 14.D and 15 | We may terminate your franchise only if you default. |
| (g) | "Cause" defined-curable defaults | 15.B | You fail to pay required sums when due to us or our affiliates and do not cure within 10 days after notice; you fail to comply with franchise agreement, manuals, operating procedures, standards or specifications and do not cure within 30 days after notice; you fail to operate the franchise for 5 consecutive business days and do not cure within 7 days after notice. |
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, Annex Brands cannot terminate a franchise agreement without cause. The FDD specifies that Annex Brands may only terminate the franchise if the franchisee defaults.
The document defines 'cause' for termination, listing both curable and non-curable defaults. Curable defaults include failing to pay required sums, non-compliance with operational standards, and ceasing operations for a short period, each with specific notice and cure periods. Non-curable defaults include failing to open the franchise in a timely manner, making misrepresentations, criminal convictions, unauthorized disclosure of confidential information, and repeated defaults.
This is a standard practice in franchising, as it protects franchisees from arbitrary termination. Franchisees should carefully review the definitions of 'cause' in the franchise agreement to understand their rights and obligations. Understanding what constitutes a default and the procedures for curing a default is crucial for maintaining a healthy franchise relationship with Annex Brands.