Under what condition is an Annex Brands franchisee required to abide by modifications to the System?
Annex_Brands Franchise · 2025 FDDAnswer from 2025 FDD Document
the Marks. Subject to the other provisions of this Agreement, Franchisee expressly agrees to abide by any such modifications, additions, deletions, alterations, and other changes; provided, however, that such changes do not materially and unreasonably increase Franchisee's obligations hereunder, it being understood and agreed that no aggregate expense(s) during the term of the Franchise granted under this Agreement less than or equal to $80,000 will be deemed material and/or u
Source: Item 22 — Contracts (FDD pages 109–110)
What This Means (2025 FDD)
According to the 2025 FDD, Annex Brands franchisees must adhere to modifications, additions, deletions, alterations, and other changes to the Annex Brands system. These modifications can include alterations to programs, services, methods, standards, forms, policies, and procedures, as well as changes to the services the Center is authorized to offer and modifications to the Marks.
However, this requirement is conditional. Annex Brands franchisees are only obligated to abide by these changes if they do not materially and unreasonably increase the franchisee's obligations. The agreement specifies that aggregate expenses during the franchise term less than or equal to $80,000 will not be considered material or unreasonable.
This clause provides Annex Brands with the flexibility to adapt its system to changing market conditions and technological advancements, while also offering some protection to franchisees against changes that could significantly impact their financial obligations. Franchisees should carefully consider this clause and understand the potential for system modifications and associated costs when evaluating the franchise opportunity.