What section of the Annex Brands franchise agreement discusses the payment of fees?
Annex_Brands Franchise · 2025 FDDAnswer from 2025 FDD Document
- E.
PAYMENT OF FEES.
Franchisee will pay or enable Franchisor to collect any and all sums or amounts promptly as they became due.
Franchisee's failure to pay amounts when due may constitute grounds for termination of the Franchise.
Franchisee must authorize payment to Franchisor by automatic draft from Franchisee's designated bank account or otherwise establish a payment arrangement whereby Franchisor will be able to present a draft to Franchisee's financial institution and withdraw funds from Franchisee's bank account to pay royalty fees, marketing fees, national convention participation deposits, technology services fees, insurance premiums, or other fees under this Agreement and all other agreements between Franchisee and Franchisor and/or its affiliates, expenses, equipment lease or rental payments and/or supplies payments, purchases from Franchisor and/or its affiliates, interest, late fees, or any other indebtedness to Franchisor or its affiliates.
Franchisee agrees to always keep sufficient funds in its designated account to ensure that any draft will be honored by its financial institution.
Franchisor may specify periodic amounts for regular transfer to its account, based on past reports of sales by Franchisee and Franchisor's reasonable expectations of amounts to become due from Franchisee.
Franchisee agrees to advise Franchisor in advance of any change in its financial institution or account.
Payments are deemed made when received by Franchisor at Franchisor's Corporate Office.
Franchisor has the sole discretion to apply any payments by Franchisee, and any credits received by Franchisor on the Franchisee's behalf from any third-party vendor or supplier, to any past due indebtedness of Franchisee for royalty fees, marketing fees, national convention participation deposits, technology services fees, insurance premiums, or other fees under this Agreement and all other agreements between Franchisee and Franchisor and its affiliates, expenses, equipment lease or rental payments and/or supplies payments, purchases from Franchisor and/or its affiliates, interest, late fees, or any other indebtedness to Franchisor or its affiliates.
Source: Item 22 — Contracts (FDD pages 109–110)
What This Means (2025 FDD)
According to Annex Brands' 2025 Franchise Disclosure Document, Section E of Item 22 discusses the payment of fees. This section stipulates that franchisees must promptly pay all sums or amounts due to Annex Brands and allow Annex Brands to collect these payments. Failure to make timely payments can be grounds for termination of the franchise agreement.
To ensure payments, Annex Brands requires franchisees to authorize automatic drafts from their designated bank accounts. This arrangement allows Annex Brands to withdraw funds to cover royalty fees, marketing fees, national convention participation deposits, technology services fees, insurance premiums, and other fees outlined in the franchise agreement or any other agreements with Annex Brands and its affiliates. These automatic drafts can also cover expenses, equipment lease or rental payments, supplies, purchases from Annex Brands, interest, late fees, or any other debts owed to Annex Brands or its affiliates.
The agreement emphasizes that franchisees must maintain sufficient funds in their designated accounts to cover these drafts. Annex Brands may specify periodic amounts for regular transfer based on past sales reports and reasonable expectations of future dues. Franchisees are responsible for informing Annex Brands in advance of any changes to their financial institution or account. Payments are officially made when received by Annex Brands at its corporate office.
Annex Brands retains the sole discretion to allocate payments received from franchisees or credits from third-party vendors to any outstanding debts. This includes royalty fees, marketing fees, national convention participation deposits, technology services fees, insurance premiums, and other fees, as well as expenses, equipment lease or rental payments, supplies, purchases, interest, late fees, or any other indebtedness to Annex Brands or its affiliates.