Under what conditions can Annex Brands require changes to the Center at the franchisee's expense?
Annex_Brands Franchise · 2025 FDDAnswer from 2025 FDD Document
No replacement of leasehold improvements, furnishings, equipment, displays, signs, or graphics will be made, nor will any material alteration to the Center as originally developed or approved by Franchisor be made, without Franchisor's prior written consent. Franchisee will place or display at and within the Center only such signs, logos, emblems, lettering, graphics, and display materials as are periodically approved or designated in writing by Franchisor. Franchisor may require any changes, replacements, or modifications not previously approved by Franchisor to be rectified at Franchisee's sole expense and Franchisee will promptly make any such changes, replacements or modifications.
Franchisee agrees to maintain the condition and appearance of the Center consistent with the System and required uniform image of its franchised businesses as a modern, clean, attractive and efficiently operated Center, which offers high quality products to the public based on friendly, creative and efficient service. Franchisee agrees to perform or cause to be performed at Franchisee's expense whatever maintenance of the Center is required to maintain such condition, appearance, and efficient operation, including: continuous and thorough cleaning; periodic decoration and repair or remodeling, as necessary, of the interior and exterior of the Center; and replacement of worn-out or obsolete leasehold improvements, furnishings, fixtures, equipment, displays, signs, and graphics with approved leasehold improvements, furnishings, fixtures, equipment, displays, signs, and graphics. The Center must have new flooring, and the interior must be repainted to Franchisor's specifications at least once every 60 months. Any tile flooring must be cleaned daily and polished at least semi-annually, and any carpet flooring must be cleaned daily and dry-cleaned at least semi-annually, to Franchisor's specifications as necessary to maintain a clean appearance.
If Franchisee does not maintain the condition and appearance of the Center as is required by this Agreement, Franchisee will give Franchisor access to the Center on not less than 3 days' prior written notice from Franchisor, so that Franchisor may: 1) arrange for the necessary cleaning, repair, remodeling, upgrading, painting or decorating; and 2) replace the necessary leasehold improvements, furnishings, fixtures, equipment, displays, signs, or graphics. Franchisee must pay the entire cost thereof within 10 days of receipt of an invoice from Franchisor for the services or purchases. Franchisee's failure to give Franchisor access to the Center, or to reimburse Franchisor in accordance with this Subsection 9.A, is an act subject to the default and enforcement provisions of this Agreement.
Franchisee agrees, at its expense, to keep its computer system(s) in good maintenance and repair, and to install such additions, changes, modifications, substitutions and/or replacements to its computer hardware, software programs and licenses, telephone, fax and power lines, and other computer-related facilities as Franchisor directs in its sole discretion, in the Manuals, in writing or otherwise.
Accordingly, Franchisee expressly understands and agrees that Franchisor may periodically change the components of the System, including altering the programs, services, methods, standards, forms, policies, and procedures of the System; adding, adding to, deleting, deleting from, or modifying those programs and services which the Center is authorized to offer; and changing, improving or modifying 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 unreasonable.
Source: Item 22 — Contracts (FDD pages 109–110)
What This Means (2025 FDD)
According to Annex Brands's 2025 Franchise Disclosure Document, Annex Brands has specific requirements regarding the appearance, maintenance, and standards of its franchised centers. Annex Brands requires franchisees to maintain their centers in a manner consistent with the brand's image, ensuring they are modern, clean, attractive, and efficiently operated. This includes regular cleaning, periodic redecoration, repairs, or remodeling, and the replacement of any worn-out or obsolete fixtures, equipment, signs, and graphics with approved items. Specifically, the Center must have new flooring, and the interior must be repainted to Annex Brands's specifications at least once every 60 months. Tile flooring must be cleaned daily and polished at least semi-annually, while carpet flooring must be cleaned and dry-cleaned to maintain a clean appearance.
If a franchisee fails to maintain the center's condition and appearance as required, Annex Brands can take action. After providing at least three days' written notice, Annex Brands can access the center to arrange for the necessary cleaning, repairs, remodeling, upgrading, painting, or decorating, as well as replace any necessary fixtures, equipment, signs, or graphics. The franchisee is then responsible for paying the entire cost of these services and purchases within 10 days of receiving an invoice from Annex Brands. Failure to grant access or reimburse Annex Brands can result in default and enforcement actions under the franchise agreement.
Additionally, Annex Brands retains control over the signs, logos, emblems, lettering, graphics, and display materials used at the center, requiring franchisees to use only those approved or designated in writing by Annex Brands. Annex Brands can mandate that any changes, replacements, or modifications not previously approved be rectified at the franchisee's expense, and the franchisee must promptly implement these changes. This ensures that all Annex Brands locations maintain a consistent and uniform image, contributing to the overall brand reputation and goodwill.
Furthermore, Annex Brands can direct franchisees to install additions, changes, modifications, substitutions, and/or replacements to their computer hardware, software programs and licenses, telephone, fax and power lines, and other computer-related facilities as Annex Brands directs in its sole discretion. Franchisees are responsible for keeping their computer systems in good maintenance and repair at their own expense to ensure full operational efficiency and communication capability between Annex Brands's computer system(s) and those of all Centers.
Finally, Annex Brands may periodically change the components of the System, including altering the programs, services, methods, standards, forms, policies, and procedures of the System; adding, adding to, deleting, deleting from, or modifying those programs and services which the Center is authorized to offer; and changing, improving or modifying the Marks. 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 unreasonable.