Under what conditions can Annex Brands receive reimbursement from the marketing fund?
Annex_Brands Franchise · 2025 FDDAnswer from 2025 FDD Document
Other than reimbursement for reasonable costs and overhead incurred in activities related to the administration or direction of the fund, neither we nor any affiliate will receive any payment for providing products or services to the fund. If we spend more than the contributions accumulated in the fund during any fiscal year, we will have the right to receive, on demand, reimbursement from the fund in later years to the extent of the excess expenditure.
Source: Item 11 — Franchisor's Assistance, Advertising, Computer Systems, and Training (FDD pages 45–62)
What This Means (2025 FDD)
According to Annex Brands' 2025 Franchise Disclosure Document, Annex Brands can receive reimbursement from the marketing fund under specific conditions. Annex Brands may be reimbursed for reasonable costs and overhead incurred while administering or directing the fund. This means that direct expenses related to managing the marketing fund, such as administrative tasks, can be covered.
Additionally, if Annex Brands spends more than the accumulated contributions in the fund during any fiscal year, they have the right to receive reimbursement from the fund in later years. The reimbursement will be to the extent of the excess expenditure. This provision ensures that Annex Brands can recover costs if marketing expenses exceed the available funds in a given year, providing some financial flexibility.
It is important to note that Annex Brands prepares an unaudited report of the fund's operation annually, which is available to franchisees upon written request. This report can provide franchisees with transparency regarding how the marketing funds are being managed and spent. The fund is not audited, which may be a point of concern for some franchisees who prefer the assurance of an independent audit.